Well on Sunday night there was a little triangle over the upgrade fare, in one corner, saying the word 'Deal', and the price itself was in bold type. As if to emphasise the 'deal'.

That's perfectly normal. It just means it's a "deal" ie a special fare - it's not something specific to you.

The simple explanation for your situation is explained above. Fares are not confirmed until paid for, so throughout the booking process anybody else could book a fare and make it unavailable. I've had this happen to me so many times that it's become an annoyance, but the reality is there isn't anything that can be done to change it. That's just how the booking engine works, and changing it so fares were held would open up a whole big can of worms.

Yeah, this is a regular promotional fare. I get these all of the time when searching. They typically have limited numbers of seats. These usually give a reasonable discount over list fares but better fares can still sometimes be found elsewhere.

But the original PE price was noted at 3500 which is more than 2060 + 808:confused:

I wonder if this upgrade offer is a variable thing? Didn't get anything clicking through. Must be. It just seems weird to do this when you've got a) seats for cash b) RUs c) one ups ....although a set cash price is probably more profitable than the other options.

EDIT: Colours - just to clarify, are you referring to the little purple triangles within the fare boxes of PE or BP? (That would change what I'm envisioning!)

:D Thought you all would appreciate this update: Air NZ has kindly refunded me the difference between the $816 upgrade offer that I saw and assumed I would get, and the $1500 that the system said was the new fare at the 'review and pay' stage of the booking. Very good of them to do that. End of story.