PaulR,
Take the cheaper seat and credit the flight to DL. You still get base miles for it and (I assume) the elite bonus (never done that before) along with the same seat. Seems strange that the pricing is so different. They must not be aware of it.
And just to reaffirm, Opus is correct. No upgrades EVER to First class using a SWU. You can't even buy a First Class seat on a DL code-share flight.
In ATL, I once asked what the odds of a nice guy, flying in biz, on a DL ticket, on an AF flight, were for getting upgrading. The AF lounge agent laughed at me.
From what I have experienced on other occasions, I don't think it will ever happen.