I think John Allen did the right thing. Calling it a PR nightmare may be technically true, but this was one nightmare that HAD to happen. I'm surprised Lindner didn't cave in like he did last time.
What if a new GM comes in and expresses interest in bringing Barry back at a SLIGHTLY higher rate (say $700K-$800K) and can talk Larkin into accepting that salary as a utility player? My thinking is that the Reds are trying to clean up all the loose threads before a new GM is named, BUT a new GM needs to opportunity to put together a team at a decent payroll. He may decide Barry would make a nice utility player.
I just think we're making a lot of assumptions based on the opening moves in a financial chess game. Allen has spoken. Larkin is appealing to the sentimental fans. It's one big negotiation done in a public forum.