I had not bothered to read this thread (gist seemed obvious from the subject) so I do not know if this adds anything to the discussion, but I overheard the purser and another FA on a recent flight discussing this. The purser was telling the other FA that he had witnessed a GS get upgraded in the app after boarding and come forward to claim his seat, only to find a deadheading pilot in it (and one in the seat next to it also). He showed the app to the FA and the pilots said doesn't matter, we have the upgrade priority and the boarding passes, so tough luck. GS got sent back to Y. Not sure what happened there (gate agent messed up in manually upgrading the GS?) but at any rate it came as a surprise to the purser and the FA he was telling, that deadheading pilots trump GS in upgrades. Maybe the only interesting part of this anecdote (if any) is that even experienced FAs don't know about a 4 year old policy.

[Edited to add: when I say surprise, I should say shock, the tone of the conversation was that they clearly thought this was bad customer service and were on the side of the GS in this instance]