I had this question long ago as well.
I still don't know the definitive answer but at least have more theories based on my observations.

It's seems to me that the purchase of a better seat is a separate product from priority boarding. I was given a better seat but C boarding.

So then I shelled out more money to buy priority boarding and got an A boarding assignment. Thinking this was great I was soon faced with a huge line of people also with A boarding cards including a group of students. I thought to myself what it going on.

Turns out all the A folks were actually headed towards the back of the plane except for me as I was towards the front but I'm just lumped in with the other A boarders so that I get to board first. Practically this works as intended just wacky logic that paid priority boarding is lumped into the same line as back of plane boarding.

And of course when I finally looked at the people I sat next to on the plane they were mostly folks I saw in the C line.

You'll find that TAP is just really weird and there are some rules enforced and others ignored. They operate very similarly to low budget airlines. It's basically a lottery whether they pull out the weigh scale and or the bottomless box to place over your rollerboard to gauge the size of your carry on.
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