The way i see it: Toronto can either buck up and spend the money on their budding star... Or trade him for less than his value.
Toronto is willing to pony up the cash, but Nylander is holding out for more. Neither side is wrong in their pursuit.
That being said, Toronto is in a vulnerable spot with trading him, but Willy is in a vulnerable spot in negotiating because he's not going to return what's worth what they'd get back. He is in a tight spot.
Ultimately, he's going to re-sign. The cap will likely go up, and Toronto can afford him... But it's going to be pricier than tml fans want. They just gotta hope the cap continues to go up...