It's this. Using airlines as an analogy, upgrade rates can be quite low, even for top elites. But there's at least a transparent process that lets people know where they stand. And you also don't (often) miss out on an upgrade because a seat flew empty.

Short of making NUAs confirmable at booking or adding an upgrade list, I think SNAs would be way better if you could at least see the number a rooms of each type available. If at 2pm the day prior to arrival any matching room types are available, the upgrade is confirmed. This will never happen, though.