Note: German units & armies will only upgrade if they are elite when the next level unit technology is discovered. So if your archer gets an elite upgrade after you've discovered Democracy (and thus Pikemen), they are stuck as archers and will never be upgraded. Also, I believe you have to discover the upgrades in order - if you skip one of the technologies (i.e. skipping Gunpowder/Riflemen for Mass Production/Modern Infantry) your units will not upgrade. Finally, only German Warriors are automatically veterans.
Leonardo's has a similar issue - if you've skipped over one of the technologies, your older units will only be upgraded to the last tech before the break (i.e. if you skipped Gunpowder, your Archers will become Pikemen instead of Modern Infantry).