Yeah you are right about the message in general. They should display this for accounts that are not eligible, they should work on that. It's basically displayed for every single user, probably even for like silver VIP or something (not sure though). That's the issue on hand and if they would fix this there would be no confusion.
My friend was also confused and disappointed of course, since he thought he would get his host back. When the display shows 100% of course as a player you would assume he will get his "reward". I doubt it's intentional or anything. Just somebody was to lazy to program it right so that not every single user can see this on the interface.
Right. Whether it was intentional or just poor implementation, it shouldn't show that message to ineligible users. If someone sees a "100%" bar and a clear condition with no disclaimer, it's natural to assume they'll receive the benefit.
Bottom line: This needs to be addressed.