Unless there is another injury or a dramatic change in the condition of his knee from where it is today, Kronwall can't go on LTIR(etirement). To be placed on LTIR, players must be deemed unable to play by the team physician (notice this does not say play effectively). Given that Kronwall just played a combined 43:29 on back to back nights, I think we can safely assume he is physically capable of playing in the NHL (just not necessarily capable of playing well).
Look at players currently on LTIR(etirement) right now: Pronger, Franzen, Vitale, Horton, Bolland. These are players with severe concussion issues or debilitating back injuries that have rendered them physically incapable of participating in an NHL game. For them, it is not a matter of pain tolerance or declining effectiveness (as is currently the case for Kronwall). Rather, no competent physician would ever clear them to play in a contact sport at the highest level.
Now for the practical (i.e. $$) side of things: the Wings will not put Kronwall on LTIR unless they are absolutely required to (that is, he suffers an injury performing his duties for the team that render him physically unable to play). Why? Because the Wings aren't going to skirt league rules and willingly pay Kronwall another $5 million (the amount left on his contract) for a minor cap benefit. And how minor is it?
If Kronwall retires this summer, the Wings will suffer a recapture penalty of $2.125 million in each of the next two seasons. If Kronwall goes on LTIR(etirement), the Wings may exceed the cap by the amount of his $4.75 million salary during the season (that's the key). However, the teams may only exceed the salary cap by 10% during the offseason (let's assume the cap increases to $75 million next year, so the Wings could exceed that by $7.5 million). There is no LTIR during the offseason. With Franzen also currently on LTIR(etirement), the Wings would be able to exceed the cap by a combined $8.7 million during the season, but only $7.5 million in the offseason. Therefore Kronwall's contract would effectively still prevent them from spending within $1.2 million of the cap during the offseason (when most player personnel moves are made).
The bottom line: LTIR isn't a 'get out of jail free' card and the Wings aren't going make moves of questionable compliance with CBA and pay Kronwall a hefty sum of money all for roughly a $900,000 cap benefit (depending on how the cap increases). If Kronwall doesn't play next year, it is far more likely that he will simple retire.