MS called and came through!!
My points are all correct now.
For some reason the second set of OTUP from MB BOGO was put in as a transfer and that was affecting the order that it was taking points.
Previously I did not have banked any points when making the reservation at the 7 month window so now it was pulling from the recently banked points that I had freed up instead of the OTUP since the system saw them as transferred points.
They still couldn't explain how contracts I had selected to use were not checked or the lock on the ones being used but at this point I'm just happy to have my points correct!!