Here's where much of the confusion comes from: US does indeed classify Canada as a domestic destination. I was unaware that UA did not in terms of RCC access on F tickets. Even if it had been possible to fly YYZ-PIT in F, you would have not been granted access. And as obhasan has mentioned, it appears that UA has changed their policy as well.
Certainly, people purchase F tickets on US, however their fares are often lower than other carriers in order to match the level of service. Just ask any US Preferred member who's ever tried to upgrade on flights to LAS, for instance... if just doesn't happen. US's F's cabin to a US Dividend Miles member is basically akin to UA's E+ cabin for Star flyers. Of course, that sucks if you're a Star flyer travelling on US, but not if you are DM Preferred
Which brings to light the reason that AC does not offer an upgrade policy which is anything like US's. Based on the YYZ Do, I realize that this is a sore point, but if such a policy were to be implemented, you can bet that service would degrade considerably in J. Plus, AC tends to have fewer J seats available than US does on similarly-sized aircraft, so upgrade chances would be quite low.
SH: My point was solid but the wording incorrect; didn't want to be late for work. What I meant to say was "Club access for F passengers - US's policy is in line with other American carriers, including UA." As in the original OP's family members in F were correctly denied entry.
US definately has its place in the market. It may not be for everyone, but it did allow the OP get his entire family to their vacation on time, and in relative comfort. The OP could have opted to spend almost as many miles for Avenue Awards on AC, and then no one would have been in a premium class.
Personally, US has worked very well for me because of it's flying patterns and the fact that most agents will absolutely bend over backwards for US Preferred members. I never have to wait more than 2 minutes on hold while calling them (usually get right through), their service failure recovery is definately above average in terms of the service industry, and I cannot count how many times US agents have gone above and beyond to save my ..., even when it wasn't really a big deal in the scheme of things. I love having empower and jetconnect at every seat on all airbus aircraft. I love the Consumer Affairs department, which is never hard to get ahold of. I love their fares (most of the time). I love being able to get ahold of any fare transatlantic upgrades with relative ease. And I love Dividend Miles, where all fares on US get at least 100% Qualifying miles. Because of these things, I am willing to forego many of the shortcomings that could potentially irk others. But if it's not for you, then it's not for you (just like Aeroplan isn't for me). Simple as that.