Is it a french double or a real twin? I've never seen a queen bed in an Italian hotel room (they are always french doubles or two twins = king), but I have seen the Sheraton Diana advertising queen bedded rooms before.

Aside from the bed issue, I agree that it's always disappointing to not receive an upgrade reflecting your status. But the important thing to remember is that upgrade is not guaranteed. Last week was the accessories fair and fashion week is now starting in Milan. You are also staying at a hotel that happens to be a favorite of the fashion crowd. Rooms are very hard to come by in all of Milan during this two week period and every decent hotel is running at full occupancy and then some. Even if there are rooms available at the Sheraton, it's 99% likely that their inventory consists only of smaller, standard rooms - the fashion magazine editors and their assorted assistants tend to book larger rooms and suites.