We tried that approach with Jason Peters. He got fat, lazy, and held out wanting more money. It was a good move trading him.
Maybe Levitre would have been fine living out the extension you proposed, maybe he whines like Peters did. We'll never know now. I'd be pissed if we had re-signed him for 7 or 8 M a year. Too many memories of him him being forklifted/thrown straight back into the QB. He is durable and played well enough at C and LT when asked, but TEN is nuts for paying him that much.
After the draft there will be a few players released as well. With only 6 picks in the draft, it seems like they HAVE to do something at WR in free agency for some depth. And I assume they are drafting a WR in the first 3 or 4 rounds.