Recurring Orders and Product Upsell are compatible as long as your Recurring Orders style is set to "Multiple Products" or "Recurring Cart". This allows you to trigger upsell or cross-sell offers when someone adds a subscription to their cart, or goes to checkout from the site.
Product Upsell is not able to offer Recurring Orders' subscriptions as upsell/cross-sell products. The subscription information does not get passed to the cart correctly when they are used as the offered item.
It doesn't work with "Single Product" style because the customer never actually enters the Shopify cart, which is where the upsell is offered. With "Single Product" style, the customer is taken directly to the Recurring Orders checkout.
Visit Use Recurring Orders in Recurring Cart Style for setup instructions.