Personally, I still don't like the trade, and I would rather have Menell than Merrill, at least until they prove me wrong. That said, it seems obvious that nobody wants to give Menell a 1-way, and that was reportedly the hill he had decided to die on in Minnesota. I think he finally accepted a 2-way was reality after negotiating with yet another front office and them being unwilling to give a 1-way as well.
The end result is that I think Menell was being slightly stupid for being unrelenting on the 1-way, when he really needed to just bet on himself and play his way onto the team. I also think Guerin was stupid for not signing the super-cheap defenseman with upside that he already had over a (potential) few hundred thousand dollars. If I were running a team I'm sure I'd make tons of mistakes, but I think one decision I'd be very comfortable about is potentially paying 300-500k extra (which only happens if the player gets stuck in the AHL) for a player's potential upside, rather than pay slightly more money to remove the upside from the equation altogether.
My conclusion is that everyone is stupid.
Yeah, including me, because this is probably a non-issue by the end of the season.