Interesting work by Eddie at Detroit Tiger Thoughts. He figured out the free-agent classification system used by MLB, which determines draft-pick compensation.
Pudge Rodriguez has apparently slipped to Class B. That means if the Yankees offer him arbitration and he signs with another team, they would receive a supplemental first-round pick, not the other team’s first-round pick.
The Yankees have a bunch of free agents (Pudge, Pettitte, Moose, Giambi, Abreu, Pavano, Marte) and could theoretically get a pile of draft picks. But they also have to be careful about who they offer arbitration to.
Pudge makes $13 million and may jump at the chance at a raise and another year in pinstripes. Giambi almost certainly would.
Teams sometime have deals with players to decline arbitration. I do not know which players, if any, the Yankees have such an agreement with. For a Type A player, such a deal might limit their market as teams now place more value on draft picks.