DB seat reservations

"do they oversell?"

They will not sell more reservations for a train then there are seats. However they will sell as many Berlin to Dresden tickets as there are people that want to buy Berlin to Dresden tickets...

A ticket does not guarantee a seat. A ticket allows you to use trains on the route it has been sold for.
The point of a reservation is to guarantee you a place to park your posterior if more people board a train than there are seats available.

It appears I can reserve the seats I want through České dráhy for a nominal amount. Why DB won't let me select seats is not clear to me.

DB is like that sometimes. I have often found trains where I could select specific seats using ÖBB (Austrian) but not DB.

it says "Seats selected automatically"

Did you get a dialogue checking your preferences, e. g. window or table?

After this dialogue the system chooses a seat automatically for the user but it is still changeable - in desktop mode by clicking on a text in the upper right corner of the box showing the reserved seat. When you click there you will see a dialogue showing wagons with each available seat in your booked class.

No more help needed.

User posted on TA forum that he reserved seat on another platform. Would be helpful to be informed by Richard about that.