Can you upgrade the free flight to Business Class using Velocity points?
Not according to ANZ
https://www.anz.com.au/content/dam/...ures-air-travel-benefits-terms-conditions.pdf
7. You may not combine this Flight offer with any other
offer, promotion, discounted or non-standard rate, or
use loyalty points or payment to upgrade your Flight to
a non-economy cabin.
but i suspect we do get Status Credits (because they dont say you dont). See a poster a page or so ago, it would appear SC's are awarded based on Getaway (Restricted Economy)
14. You will not earn any loyalty points in the Velocity
Frequent Flyer program (or any other loyalty program
operated by Virgin Australia or its affiliates or partner
airlines) in respect of the Flight. [/QUOTE]