Denied Titanium Upgrade Because of NUA request?

I’ve heard a lot of excuses for no upgrades and usually i just politely take whatever room i booked and carry on my way, but…this excuse is new to me.

I requested an upgrade through the app for one tier above what i booked with my NUA credits and was denied (fine) but i get to the hotel and ask for an upgrade politely at checking in. There is literally 5 cars in the parking lot in a hotel with 700+ rooms and they are still selling all room types online for tonight.

FDA says “Sorry, now that you requested to use NUAs, and that wasn’t fulfilled, I’m not allowed to upgrade you. Had you not requested the NUA, and been denied, i could upgrade you.”

WTF? Is this new or am i hallucinating?