I flew out to Orlando yesterday and there was a large chap in a D seat spilling over slightly in to the E seat. I say slightly; it was enough to make the E occupant uncomfortable and she was unable to use her video controls due to the roll of skin that shrouded them.
Fortunately, despite being booked pretty full, there were a number of empty seats on the flight and I was able to re-locate E and F to their own row of three leaving the larger gent three seats to himself (which he actually moved his family in to).
I've been lucky in that I have never had to take drastic action regarding the size of a passenger - I have always had other seats available to move people in to. I dread the day when I don't, though.
I imagine that, if the armrest won't go down fully for takeoff, we would have to look at offloading said passenger and insisting that he/she buy a second seat for another flight.
I don't agree with charging full price for the second seat - that's a bit mean. I do think that we should make a charge of, say £100.00 per sector on long-haul flights for keeping the adjacent seat free as, although they will fill a lot of the combined space, they will still have more room than anyone else on a full service.