Just when I thought I knew all the rules I find a new one...

I just booked a flight IAD-LGA for myself and two friends, one reservation. Although I would never upgrade myself on such a short route, I thought my friends who never fly 1st would enjoy it. Besides, it's just one 500 cert, and I have them coming out my ears anyway. I just called res. and was told that I can only upgrade one other person with a 500-cert. Is this correct? I know that I've upgraded friends before who weren't flying with me with my 500-milers, so why is there a limit on how many people I can upgrade? If I were to split the record and send one friend off on his own record, could I then upgrade my other friend and myself, and then sponsor an uprade for friend #2? I know he won't clear on my status, but hey this is a 757 and no one upgrades on a 45 minute flight anyway.

Thanks for your help, everyone!