I don't know what the reservation agents know or not and what the official policy is. I do know that there seems to be a rumor/feeling going around amongst some of them that low fare tickets are somehow held back from upgrading. Sometimes where there is smoke there is fire.

In an experience I posted earlier about my only flight on CO this year, I had the same situation and two of the reservation agents made the unsolicted comment while they were trying to find out why that perhaps it was because I was on a very low fare. There is a toll-free number you can call and have yourself upgraded manually if you come across this situation. Search this message board for my post on this.