this story is showing up in Truth & Rumors on SISports.  From the Cleveland Plains Dealer:

http://www.cleveland.com/pluto/blog/index.ssf/2008/08/terrys_talkin_about_davis_tack.html

The Cavs are talking to Denver about restricted free agent J.R. Smith, and they should go after him hard. The 6-6 Smith is athletic, shot 40 percent on 3-pointers and 46 percent overall while averaging 12.3 points in only 19 minutes a game. With Denver signing wing man Dahntay Jones and being on a binge to cut payroll (they gave Marcus Camby to the Clippers to cut $10 million), it seems Smith should be available. The Cavs have plenty of expiring contracts, which should help Denver if it continues to want to keep payroll under control.

Smith won't be 23 until September. He has averaged 10.9 points in 21 minutes a game during his four-year career. He had some maturity issues in the past, but he also was just a kid who skipped college entirely. Denver has said it will match an offer for Smith. I think the Cavs should offer something close to the mid-level exception and see if the Nuggets will do it -- or force their hand in a deal.

If they can possibly get West or Varejo out of the deal, might not be a bad move.  Yes, JR is one of the most explosive scorers and if he gets playing time, he can ignite the offense.  However, I'm still not sold on his intelligence for the game, and he struggles to play good D consistently.  In light of the Nuggs cost cutting approach, if he's looking for a long term, big money deal, they might be better off trying to get something for him in the short term.