There's a history lesson in why the rear 1st class compartment is permanently declassified.Either don't bother with First Class at all, or don't declassify at all.
Personally, I favour the second option (along with reasonably priced tickets).
The 8-car class 700s had fewer standard class seats than the 8-car class 365s they replaced (fewer seats so more people could stand!)
But they had more 1st class seats! So the solution, to save bad publicity, was to declassify the rear 1st class compartment.
12-car 700s were not really an issue because there weren't many 12-car trains pre-class 700 introduction (12 car services only really operated in the peaks) but it was much more simple to declassify the rear compartment on all class 700 trains.