Here's the thing though, you even state that his market is probably the MLE
Not quite. I state that the future is uncertain. The worst-case scenario is probably a MLE-level contract. It's not sure if he can get more, but I think he would take a discount from what he might get in order to get a deal with multiple years at above the MLE done early.
So if that is probably the tops what he will see out on the market(which I think is low, I think someone will have some left over cap space above MLE level yet below the max that will give Ray and offer), why should the C's pay more
Sometimes, if you offer a player a reasonable contract, it might encourage him to skip testing the market and seeing what someone else will pay him. If you have an accurate estimate of what Ray Allen can get as a free agent, it is possible you can sign him to a contract below that by getting an early offer in before he starts talking to other teams. So the question is, if Danny Ainge wants to re-sign Ray Allen, is he smart enough to guess what sort of offers RA will get and to make an offer that is low enough to give the Celtics a discount from market value but high enough to not come off as an offensive lowball offer?
I think this is different from Jame Posey or Leon Powe being allowed to leave in that Ray Allen is clearly superior to the alternatives for next year.
$10 million a year for a 35 year old SG, a position that history shows will probably have his production fall off precipitously in the very near and foreseeable future at that age, is way too much
$10 million was a hypothetical figure, just to give a number to work with. I was originally going to do some actual math, but cut out that section.
I'm not sure what the next CBA will look like, but I think that it probably strategically valuable to structure any new Ray Allen contract to A)minimize luxury tax payments and B) have the last year be an amount that makes him a doable trade for a player signed to a MLE contract plus a player signed to a mid-first round rookie scale contact. It may be worth it to overpay somewhat on value if it makes his contract a better trade asset.