I spent over a decade working in various hotels. The bulk of that time was at Front Desks. There's a lot to unpack here, but I'll try.

Although it might seem like semantics, it's important to note that "Hyatt" doesn't assign rooms. The individual hotel assigns rooms.

This is an important note because of the following question:

No one at Hyatt Corporate or Central Reservations can actually see what the hotel does. Each individual hotel is effectively walled off from the chain. This fact is true whether the hotel is corporate owned or a franchise.

So, when you contact Corporate/Central Reservations, they will talk to the hotel but they won't be able to verify anything. They're merely parroting whatever the hotel says.

There's nothing odd about this scenario. It's effectively a numbers game.

I couldn't find stats on how many King Bed + Sofa Bed rooms exist at this hotel. They have a total of 167 rooms. The website lists 5 room types and 7 suite types. Let's guess and say they have 30 King Bed + Sofa Bed rooms.

Let's also guess that this hotel's average length-of-stay during the work week is 2.5 nights. To determine the number of King Bed + Sofa Bed rooms available on an average day, you divide the total rooms by the length-of-stay. That leaves us with 12 rooms.

While hotels do try to have all their vacant rooms fully cleaned and available at the start of the check-in window, that's not always possible.

There are tons of reasons why that goal might not be reached. Perhaps a Housekeeper called in sick. Or, it just happened at all the occupants of King Bed + Sofa Bed rooms waited until the last second to check-out.

It's also possible that all the other guests with that room type arrived earlier than you. Those guests got the clean and vacant rooms.

Many people think it's supremely odd, but the sales system is not directly connected to the hotel inventory.

Hotels will typically put limits on one-of-a-kind rooms like suites and accessible rooms. But, standard room types are allowed to be overbooked.

This is common because it usually works out in the end. Plus, many people have no problem switching from one room type to another.

Did you ask if a King Bed + Sofa Bed would be available if you waited? The Front Desk clerk should have proactively mentioned this, but I'm curious if you asked.

Provided you aren't on a long-term stay, every hotel I worked in would have bumped you up to this room type without an additional charge. It wouldn't have even been something that required approval from a manager.

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TL;DR: It's not unusual for a hotel to not have a given room type available at the start of the check-in window. The fact that the hotel refused to upgrade a guest with a confirmed room type (without charge) in order to instantly resolve the problem means this hotel probably isn't well-run.