Forgot to add:
I checked into the Arabella Sheraton Grand Hotel (Luxury Collection) yesterday night and it appears that the policy of "upgrade to next category room" was enforced as well... so it may not be limited to the sheraton Frankfurt Airport.
I booked a deluxe room at this hotel, and was told I was upgrade to the Grand Deluxe room (next category type).. I asked if that is the best available room - and after a bit of key punching, the check in agent said that the junior suite is also if I was interested...
So, moral of the story, be persistent and ensure that you are getting the "best Available" room.