If I had received that response with a 50USD I'd be fuming. I'd argue that I had booked CW solely and exclusively because of the flat bed, and that otherwise I'd have booked the cheapest economy seat available that I could find.

People will tell you that you should consider all the aspects of the service received, etc. Ignore all that. Stick to the argument that you wouldn't have booked anything but the cheapest economy fare if it wasn't for the flat bed and that you'd gladly forfeit everything else.

Therefore, I'd be asking for a refund for the difference between what was paid and the cheapest fare I could find on a direct flight (BA or not, it doesn't matter).

I would put that in a letter before action now. No point in continuing correspondence with CS. I would then pursue this via MCOL.

You'll get a lot of different advice here. I've sued a number of airlines over the years and my approach has served me well. YMMV.​​​​​