Just a few thoughts:
1) 7 vs 8 years. A 400k/year cap savings for 7 years (2.8M) is balanced out by paying a 37 year old, likely below replacement level, Hyman $5.1M in the 8th year. Is there really a net benefit?
2) That said, assuming the 8 year deal is better, then denying Edmonton this helps all the 30 other NHL teams by the same logic. However the highest benefit goes to their Pacific division opponents, then Central division and the lowest benefit to Eastern conference teams (i.e. Toronto).
3) However, if Toronto agrees to the sign and trade, then Edmonton arguably becomes stronger against the entire NHL, but that mostly affects Pacific division opponents, less so Central and barely affects Eastern conference teams.
4) With the sign and trade, in addition to being an Eastern conference team that is affected the least by Edmonton's benefit, Toronto will also gain a 5th and 7th round pick giving them a material advantage relative to the 30 other teams in the league. Draft picks are trade currency that mature into lottery tickets.
In trying to extract a "fair" price, Dubas was tunnel visioning on Edmonton's benefit and ignoring the fact that there are 30 other teams in the NHL to compete against, with half of those (Eastern conference) who's relative strength have a much higher impact on the Toronto Maple Leafs' future success. Or in colloquial terms, Dubas simply couldn't see the forest for the trees.
Even without the picks, by virtue of game theory, Toronto would have been in a better position than half the league by helping Edmonton with the sign and trade. In forgoing the two drafts picks, they also missed a free opportunity to improve their relative position against the entire league. These opportunities should not be squandered and that's why it is common to accept any compensation for a departing UFA (and it's unfathomable why the concept of fairness even entered the equation). One wonders what caused Dubas to act so stubborn and irrationally.