I think the question is this...do you think the celtics can win it all this year? If the answer is no, there is no reason not to shop KG.
I actually think it is possible that the Celtics could be a contender to win it all next season with KG still on the roster. So, I don't think it is correct to trade KG for whatever you can get. Sure, you should always look around and continually reassess the value of every team asset.
I also don't think it is correct to assume this will be his last season. In 2010-2011, he was an All-Star and was possibly the best big man on defense not named Dwight Howard. I think it is not impossible that he remains an above average PF who is first or second team NBA All-Defensive and I can't see him retiring if he still performs at that level. I also think it is possible you see negligible drop-off in his performance compared to last season.
A lot of people talk as if Garnett was massively overpaid. He wasn't. It's not as if he was producing at a level that was only worth $8 million. Wages of Win even
has Garnett being underpaid, producing almost $4 million more value than his actual salary. This guy isn't toast and it would be a huge mistake to treat him as if this is the last season where he will be capable of being a key starter on a championship contender.
Sure, if the team isn't contending and you get a good offer, you should consider trading him. But, depending on how the free agent market shakes out, the right step moving forward might be to give him the same sort of deal that Ray Allen received a year ago, $10 million or so for a one-year contract with a one-year option. KG and RA may be good enough that giving them short contracts and being able to actually consummate next year's equivalent of the David West trade, alongside a good draft and at least one out of Johnson/Moore/Bradley showing themselves to be solid rotation players, extends the window of being longshot contenders who can't be completely ruled out.
Cap flexibility doesn't just mean clearing space to sign a max free agent. It means the rosy scenario I described is also an option if things go right.