In regards to upgrades and free FC seats coming out of the same "bucket", I heard both stories from the Aviators Service Center, but do not know which is true.
One agent told me that she was searching all FC seats, as you have suggested, because they lumped upgrades and free seats together. However, another agent had a different story, as she claimed that on some flights, upgrade seats were available, but not free FC seats, and vice-versa.
There is not a whole lot of availability going to Europe, especially when you consider that there is only 1 flight a day for most of the year to all of those cities. With 24 to 30 FC seats, I am sure that they are very limited. I was able to find a FC seat here and there, but not two together. There seemed to be plenty of coach tickets available, though.