I mean, on some level, franchising him and trading him for a 7th round pick in 2008 is better than just letting him walk (well, not exactly, we are due some compensation, but presuming that we sign sufficient talent to cancel that out).
But it's quite possible that nobody in the league is willing to suck down that kind of money for Jennings - certainly we aren't. He can happily sign his tender and then give us the finger.
PS I presume that the franchise-tagged tender offer is guaranteed money? We couldn't, say, franchise him, shop around, and then cut him with 0 paid?