I believe that if you are using OLCI, you must select a seat. You could of course not check in and take your chances at the airport.
I was booking a flight last night, and as a result of this thread I actually scrolled all the way down to look at the seating map. It's a TED flight - about 29 rows, all Economy+ or regular Economy.
I am in 1c, 1b is 'blocked' next to me to keep it free. All of Economy+ is empty... yet in Economy-, the only seats still available are the last two rows.
So a lot of people will be offered an 'upgrade' for cost to Economy+ (either by using OLCI or 'Mr Chicken' - the check in machine at the airport) If they decline the upgrade at a cost, they will be given a boarding pass by Mr Chicken and told to check with the gate agent.
Shortly before boarding the gate agent will then call those people to the podium and assign their seat (most likely in Economy+ at no extra cost)
So sometimes it does pay to wait until the last minute for a seat assignment. I usually tell the agent that if she does reassign me, I'd like to have her check with me first before assigning the seat. If I ask nicely, they usually do that....
Hope that made sense!