I'd rather have Allen on a 1 year contract and Wallace for the MLE.
Agreed. Wallace isn't getting more than the MLE from anyone. I suppose there's an argument that if he doesn't want to take it from us, and would only come to Boston if we could give him more than, say, San Antonio or Cleveland, then it's the only way to do it. But as of right now, we're not going to lose Wallace because other teams can pay more, we'll only lose him because we're not willing to pay him the full MLE or he wants to go somewhere else, potentially to start. Since we can get Wallace without the trade, it's basically Rip for Ray. While Rip makes a little less money and is a little younger, Ray Allen is just a better player. We don't fully utilize Ray (he could still score 25 ppg - what he scored his last year in Seattle - on a lesser team that relied on him; I don't think Rip could ever have been that caliber of player) but he's still better for us because he has a better three point game than Rip and can take it to the rim when necessary better than Rip. Plus, the money situation may change drastically after this year - Rip is tied up for three more years after that at big money while we may be able to resign Ray for less than Rip's making or use that money for a better-value replacement than Rip.
Additionally, this trade can't happen because Detroit can't resign Wallace for any more than we can - in fact, they have less ability. I'm pretty sure that they have to renounce his rights in order to sign Gordon and Villanueva. So they can't go above their remaining cap space - which will be less than the full MLE after bringing on Gordon and Villanueva - to sign Wallace. Trade doesn't work for us, and is impossible to boot.