I think the issue here is that the confirmed upgrade will be released when the form of upgrade is changed. If there are not upgrade seats in inventory (sounds like they are not), then the new upgrade request goes on the waitlist.

I would not think that a letter from the giftor would be enough, but it might with a sympathetic agent. The best would be getting the giftor to go with you to the airport at checkin and try to take care of it at the checkin counter (also with the letter in hand, which couldn't hurt).

I have done this switch before but either there were still upgrade seats available to get, or the original request was waitlisted so it went off the waitlist and back on.

Charles