Frequent travelers know that getting a boarding pass with a seat number actually a race they don't want to lose, and will hound the call center if there's a problem with online check-in.
† Personally I think that airlines regulated and given two options for overselling flights:
1) If you miss your flight, and a paid passenger takes your place, you should be informed and not suffer financial consequences (re-booking fees, etc).
2) If the airlines has already sold a full flight and starts knowingly overselling, it should be communicated to the passenger when they buy the ticket ('priority standby' or something). This would, of course, make customers value these tickets less.
I think the EU regulations regarding denied boarding are pretty good (or at least a good start).