Was that $500 for a King Executive room for 1 night, or 2 nights? If only one night I agree it's daylight robbery, even if the dog box was "executive".
Minimum price for an exec is around $350 a night and can quite easily go to $500 and beyond if its near capacity. Plus even a diamond may struggle to get an upgrade and have been told in the past on saturdays no upgrades beyond an exec can be given when they are really busy.