I'm guessing that in your situation, the people who were supposed to be in those seats had already checked in but for some reason didn't show up to occupy those seats. There is of course no way to know that they aren't going to show until they are ready to shut the door. At that point, there isn't time to go back and run through the waitlist.

What can also happen is that some some Gold's (or whoever books their flights) don't understand how the upgrade process works and they fail to request the upgrades. So they never get on the list in the first place. Or they've changed flights and failed to re-request upgrades.