Category 7 award night is a free night up to an award category 7. TSU (or DSU) are suite upgrades done in advance based on availability instead of waiting/hoping the property will upgrade you to the best available room including standard suites (which is what the TSU books into). So if you were globalist and standard suite was available and you didn't get that, they did not follow the rules.
And for globalists, yeah breakfast IS required to be comped by rule, so if you are globalist they aren't doing you any favors.