1. good first post, houstoncardinal. congrats and thanks.
2. your analysis is interesting, but oversimplified, and therefore flawed, in more than one respect.

in addition, this ignores the distinction between "controlled" (pre-arb/arb) players and players available post-free agency. this distinction is huge, because, at least among players who perform above replacement, only post-FA players will get market salaries. the reason duncan, yadi, molina, and thompson are cheap is that they're not being paid at market rates.

the free agent market is what it is. the cards aren't the only buyers, and thus they can't set rates. saying the cards should only go after free agents who project to deliver a win for every $1.1 million is really looking at the whole thing backwards - because there's no way that's going to work out consistently. the market is just too high.

just as an example, mark buehrle projects (via bp) to just over 3 WARP per year over the next four years. anyone who thinks a stl "hometown discount" for buehrle would involve an annual salary of $4 million, please raise your hand - and with the other hand, punch yourself in the face. ted lilly, who everyone seems to think is working out pretty well for the cubs so far, is projected to have a lower WARP - at $10m/year. johan santana's projected WARP over the next four years is about 6/year; on the open market, despite the fact that people now think the zito contract was stupid, johan still gets zito money.

rather than looking at the payroll of the roster as a whole, it makes a lot more sense to look first at the price of players on the free agent market, relative to wins added, whether it's $2m/win, $3m/win, whatever. then, commit to not signing anyone projected to be worse than that. THEN, figure out how many wins you need, how many FA players you can afford to sign and carry on the team at once - and, therefore, how many below-market players you need to have in order to get the required number of wins from the rest of the roster without breaking the bank.

i think i did a diary on this awhile back; if not, it was just an annoyingly long post somewhere. but the idea is, you can look at two things, basically. one is, are the studs (the highly paid, highly performing guys, of which most teams can only afford a handful - pujols, rolen, edmonds, carp, izzy) performing at a level that matches their salaries? and second, what is the ratio of quality "controlled" players to the rest of the roster?

i think the conclusions i drew were a) the studs were not coming close to carrying their end of the deal (this was earlier this year; they're better now, but edmonds still looks bad); b) the cards spend too much money on lower-level guys (kennedy, eck) who aren't providing that much more than replacement level - those spots should be several million dollars cheaper, because that level of production should be coming from pre-arb, minimum salary farm system guys.

the cards have holes to fill. assuming they're not going to dramatically increase spending, it may mean 2008 isn't realistic as far as making a real run. but to have a shot, the best thing to do would almost certainly not be to limit free agent acquisitions to those meeting the $1.1m/win threshold you've suggested. rather, it would be to fill as many of the gaps as possible from within - e.g., ankiel takes over after edmonds is asked politely to retire; maybe brendan ryan for eckstein or kennedy; dove/cate/keisler as pitchers - and then pay what is required for another stud in FA - buehrle, zambrano, arod, like that.