I'm kind of surprised that they wouldn't let you switch seats with the other Y pax. I have downgraded myself several times to Y (at some point during the flight) from C, Z and XC to sit by coworkers on int'l flights and have always offered my C seat to the pax I want to switch with and have had no problems. I always figured that as I paid (earned, etc) the C seat, I could gift as I wish.

At least the crew was really helpful. This isn't always the case with kids on long flights.