We have to use Mid-level exception to sign Blake because we are above the cap. Also we have to use the same exception to sign Udoka if we want. (we can use non-bird exception but the MAX we can offer is the greater of 120% of previous salary or 120% of minimum salary. Either case it's around $1 mil - no way Udoka can agree this kind of offer)
This year's mid-level is $5.356mil. Given the reported $12mil/3yr Blake deal, I think the first year salary should be around $3.7mil to $4mil. That means we have only $1.3mil to 1.7mil left in the exception to sign Udoka. That's why Quick reported last week that KP was willing to offer him only less than $2mil.
If it's true that Spurs offered $9mil/3yr to Udoka, it'd be really suprising to see Udoka even considers signing with us no matter how much he loves Portland and the Blazers organization. Even if Spurs doesn't sign him, I believe $3mil is a fair value that some teams will definitely be willing to offer.
I think it's a done deal that Udoka will not wear a Blazer uniform next season. Basically the Blazers chose Blake over Udoka. While it's sad to see Udoka go, I'd probably made the same choice if I were KP.
Please let me know if there's any misintepretation of the salary rules.