You can always downgrade for example if seats are sold out in 1st but not in 2nd (can happen as the 1st class area is sometimes way smaller).

On this route there is a passholder surcharge for the border crossing, ÖBB Italia doesn't want to acknowledge passes and prefers the money, etc. (details)

- 10€ 2nd class

- 15€ 1st class

On the other hand reservations are optional but really recommended. This is a popular train and since you won't be boarding it in Venice (departure point) expect most seats to be taken. But you'll have a reservation so that's not an issue.

Eurail offers both the surcharge and the reservation at the same time but you can't choose a seat.

ÖBB offers both but you have to select them separately. Look for your connection, add Eurail as a discount, choose one-way tickets and select Tarvisio Aufpreisverkehr and click on the reservation box. Reservation free through ÖBB like usual. Seat map available.

Railjet trains have 3 classes (2 main ones) :

- 2nd and 1st as usual

- Business class : valid 1st class ticket/required + 15€ surcharge

1st class is totally fine for this trip unless you want to treat yourselves a little. Pictures : https://www.seat61.com/trains-and-routes/railjet.htm#What_are_railjet_trains_like

Ok, thanks. I placed the order, paid the fee, downloaded the app and its there. Can I press the Get Ticket button in the app, or should I wait till I get on the train. All the details including seat allocations are showing

Ignore last question. Got it. Thanks

You will be able to use first class lounge in Vienna with your first class pass.

You will be able to use first class lounge in Vienna with your first class pass.

That sounds like a nice bonus. Is that only when I arrive at Vienna from Pordenone, or will that apply on my next leg a few days later when I head off to Prague? 

If you have a first class pass this applies even for your Journey Vienna - Prague :)