Keep in mind that, according to press reports, Dunn's 2008 option vanishes if he is traded. So that means --
If Dunn is traded now, he is signed (by the new team) for one season and then becomes a free agent.
If Dunn is traded in mid-season, he is signed for a half-season and then becomes a free agent.
If the Reds think they are likely to exercise the option for 2008, they should obviously hold him.
However, if the Reds think they probably will want to trade Dunn, he has the most value now -- when they can offer somebody a full season of Dunn. If they trade him in mid-season, they can only offer somebody a half season of Dunn.
And, if the Reds wait until after 2007, they can't trade him at all. This is because, according to press reports, once the option is exercised there is a full no-trade clause for 2008.
So, if they want to trade him, I don't think they can wait.