Yes, McDyess is under contract and the Nuggets can refuse to buy him out and force him to remain on their roster. However Denver cannot force him to show up to practices or games. Obviously, if his contract is owned by the Nuggets and he refuses to participate, he can be suspended and fined, but most teams in the Nuggets situation seek to avoid the embarrassment of having a player very publicly proclaim that your organization is not worth suiting up for. Teams also want to be viewed as player friendly and unless you have a player you view as a complete malcontent (see Stephon Marbury) teams will work to do what the player wants in situations like this.

The reason there has not been a conclusion yet is the Nuggets know they can play hardball and are seeking to buy McDyess out at a price low enough to get them under the luxury tax line. That price is below what McDyess is currently willing to accept.

Right now the Nuggets have the leverage, but realistically the situation is costing them the services of Juwan Howard. Should one of the Denver big men go down then the power swings into McDyess' hands.