The more I learn about this contract, the more it makes sense.
I think the plan is to waive him at the start of the season and let him train with the team. Since he won't have played any games, his $1m salary won't count against the cap at all.
The key is the reports saying you will be able to carry 3 players who will be deemed AHL players but stay with the team. Miller will be one. He will be able to practice and travel with the team but isn't getting demoted.
He will need to go through waivers, but because of the bonuses and because he hasn't played in a year, it will be very unlikely that a team claims him.
At the start of the season you can have a young player audition for that spot and if he's struggling, then you can bring in Miller.