Hey has anyone heard of the PO making it a rule that you can't get DCs when sending first class mail now? I ran into this at my local PO and if this is true I might have to drop out of STS soon or at least seriously manage my postage budget

That would certainly stink! Their website still lists first class mail as an option.
Delivery Confirmation may be used with the following services:
First-Class Mail® Parcels
Priority Mail®
Package Services Parcels - Includes Parcel Post® , Media Mail® , Bound Printed Matter (paid by permit imprint only), and Library Mail.
Standard Mail® Parcels - must be less than 16 ounces and mailed at the electronic price.
Parcel Select® - must be mailed at the electronic price.