I'm not quite sure what "Loews 1st free upgrade" is but I heard you could get upgrades with your Loews card so I took it out.
When we got to HRH desk, I held onto it but in full view. I didn't give it to him but he saw it and said that they could give me my free upgrade to a pool view from a standard view. I was very happy! Then he took it to write down my number.
We did not get the milk and cookies but my DD's did get a welcome gift at the front desk. A bag filled with cute little toys and sunglasses. Nice surprise.