The only thing I can assume is that Danny wants a backup big who can spread the floor more than Mutombo. I don't know if that player is out there. Sure, Joe Smith and Nick Collison would both be good fits, but they're each under contract (and Joe Smith said recently that he doesn't want a buyout, and hasn't instructed his agent to inquire about one.)
While i think it is partly about spreading the floor, I think it is more about have another 2-way player. They already have enough bench guys who have major holes in their game. I think Danny was thinking that if he is going to bring in another guy with a hole in his game (like Mutombo has on offense), he is going to wait until he has explored all other avenues.
I strongly believe that Mutombo is not a significantly better defensive player than Davis, against all but a couple teams (although one of those teams is the Lakers), and Davis is actually a better offensive player.
Perhaps he is overplaying his hand, but I think Danny is right to wait it out, and hope an actual 6th man comes available, rather than another 9th or 10th man. Because really, lets face it, Mutombo was never going to be the difference between winning the championship or not.