unfortunately believable.
Have had similar experience where a ORD/BOS flight cancelled at midnight due to massive storm (typical).
I asked AMB desk to push arrival on my 2nite stay by 1 night but they refused...
i think it was prepaid, but to be honest with my spend, act of god (weather), and that i was still spending 2 nights, i didn’t care.
i pushed...she called back 5mins later and claimed to have contacted the hotel and that they refused...then she started to read to me the rules of prepaid...literally.

meanwhile, United got me first class seats on 1st flight out the next morning, hotel/cab/food vouchers (i didnt take the vouchers but nice touch)
When i got to Boston, I talked to front desk manager and it took him about 1 second to say “oh fine, no problem...we’ll cancel last nights charge”

have posted before, i think AMB is frequently more about upselling than service