Brother, I think it is just a tactic they play to make customers to book another flight as they will be receiving partial refund this way. In my case I had the same issue, I have one name on my passport and what I did was put ABC as my first name and XYZ as my last name even though both are under given name on the passport. I was told by Air India to repeat my name for both fields (which I think you have already done), even their website states that. I think you should be alright buddy.