Qantas will NOT upgrade people just because they an empty seat up front. There are only two ways people will receive an upgrade on Qantas:

• Operational Upgrade due to paid cabin being 100% filled and they desire to get someone else on board. These are rare even for Qantas Platinum members. I had been QF Plat (and Gold before they had Plat status) since the start of tiers. They used to be good with comp upgrades, but their policy changed about 4 or 5 years ago and since then I an count on one hand the number of operational upgrades I have had (and still have three fingers uncounted).
• Use QF FF points to upgrade. To do this you need to have QF FF points obviously. For international upgrades, they are all waitlisted and not confirmed until less than 24 hours before departure. Waitlists are serviced by status priority. For domestic flights, anyone with Qantas Club access can request an On-Departure-Upgrade and those are services in order of request which can only be made in the Qantas Club. Again a stock of Qantas FF points is required for ODU.

My advice is not to make an FF program decision based on hoping for operational upgrades when QF is involved. They are really rare. If you travel back to the USA regularly, you will have better upgrade options with AA than with QF.

If redeeming miles for award flights is your aim, then definitely stick with AA. Far better burn rate, especially for premium cabin awards, and no fuel fines added to the cost of the redemption.

I also suggest you hold off your decision until Qantas announce their next round of enhancements which they have said will be implemented around the middle of 2008, which means stand-by for an announcement 6 months earlier meaning sometime in the next 4 months.