Unable to select seats is something that happens from time to time. CO stops allowing people to select seats based on load at some pre-defined level (50%-75% of seats assigned, based on the route). They do this to allow for sufficient flexibility in seat assignments in the airport for people who need to move around.

Not sure about losing seats (especially in Y since is wasn't a FAM), but it is known to happen that some people manage to convince a CSR to move the sets around.