At least there was no upfront charge :eek:

Similar Experience
 

I booked a flight for July next year and tired to upgrade I was told all the seats are gone. When I checked the seat map every business seat was available. It was like this for everyday that week. Seem odd that everyone that week upgraded but didn’t pick a seat.

I booked 3 return flights from Australia to Europe in economy Deluxe class, so far only one outbound leg I managed to upgrade with miles to a business guestseat. I would often check for rewards business(guestseat) availability on etihad.com and if there is availability then call Etihad customer service and ask about the upgrades. So far about 10% of my calls have been successful. Either the agent has no clue how come there is outright business reward guestseat availability but cannot upgrade, or they would tell me that they both correspond to I fare class, but within that fare class most of the inventory(if available) is reserved for outright business class redemptions and very little for upgrade with miles. Maybe with this new fare class policy, where it's cheaper to get the deluxe fare, they figured they had to extremely limit the upgrade availability.