This section of Xur's inventory is for upgrading exotics(not buying ones you already own) with pre-DLC stats(300 damage 30light) to post-DLC status(331 damage 36 light). It also resets a weapons upgrade progress. Since your weapon already had post-DLC stats you do not need to upgrade it. See the link below for more details.
[url=http://www.bungie.net/en/Help/Article/12457]Exotic Upgrade FAQ[/url]
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thanks its annoying i had to find out the hard way, but i will never EVER do it again, and i will be telling the people i know about it too
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Please do spread this message. If we can prevent more people from making this mistake that would be great