I think most front desk clerks are all sadists and masochists. They enjoy watching you suffer almost as much as they enjoy getting screamed at by those same people denied their benefits.
I've always made a point of being friendly with those working the front lines, especially at hotels that I spend a lot of time in. And in most instances it pays off with an upgrade. I also ask questions when I get to know staff members well, and have asked them about upgrades etc. The answer I always get is there is always more people to upgrade than there are rooms to upgrade to - especially during the week. And while there is a set upgrade report they get each day, they do have flexibility, hence my successes.
I have also been told that upgrades are usually done early in the day, however they will give away a previously held upgrade to mollify a particularly insistent guest. Or a particularly pleasant one.
But I don't honestly think there is a grand conspiracy to systematically deny SPG cardholders of their benefits. Anymore than I believe anyone enjoys giving substandard service.