"If more people are waiting on the automated list than there are seats, I was told the higher fare type determines who is upgraded automatically. "

That isn't quite true. Here's the hierarchy:

Silver elites who are booked on full coach fares have the ability to upgrade 2 days before departure so they get first crack at the upgrade.

The rest of the silver elites are allowed to be upgraded at midnight the night before departure. The upgrades occur in a strict ...who booked first series.

And soon you'll be notified (by whichever means you choose) when you've been upgraded.
That certainly beats staying up until midnight.