"Does AA give free upgrades to Frequent Flyers?"

Yes

I get 10,000 miles for a transatlantic flight in economy. To my surprise I even got the miles for last minutes, standbys, cheap non-cancellable tickets etc.

For 40,000 miles I get a free flight
For 20,000 miles I get an upgrade
For 20,000 miles I can get a companion ticket

AA have a lot of UK 'partners'. You get miles at gas stations, supermarkets and energy bills. The Herz car rental counts if booked from here as well. You can use the miles here for free theme park tickets etc. as well. At one point I had 200,000 miles until the wife got hold of them