The Pirates have a pretty good front office now. They know that Navarro is replacement-level. I'd be surprised if they rostered him for league min, let alone $5 M, let alone trading assets to roster him at $5 M.
I also think people are significantly overestimating the value Happ has around the league. A 32-year old 1-1.5 win SP with 1/6.7 left on his deal just isn't a sexy asset. I think you're looking at a decent (not elite) pre-arb pen arm or something if you move him.