Microsoft has confirmed that this is a bug in the Microsoft products that are listed in the "Applies to" section.
The list of products that qualify for the upgrade version of the 2007 Office suite indicates that Works 9 is a qualifying product. The box for the upgrade version of the 2007 Office suite states the following:
The enclosed program will search your hard disk to confirm your eligibility for this upgrade. The software will install only if you are a licensed user of one of the following products:
Microsoft® Works 6.0 or later
Microsoft Works Suite 2000-2006 or later
Any 2000-2007 Office program or suite
Any Office XP Suite, except Student and Teacher Edition