I think you misunderstand the situation, specifically what the best case scenario is for the Yankees.
Best case, the Twins keep Santana for the '08 season, and the Yanks sign him after that. The Yankees don't lose any prospects, and instead lose as you say, a draft pick. Better than losing Hughes, Melky, and two other minor leaguers.
Right now, the Twins are forced to decide whether or not they want to trade Santana. If they Yanks pull out (which they now have an excuse to do), and they don't think the Red Sox deal is sweet enough (since it isn't without Lester), the Twins might just take Santana off the market. Who knows, they might just get anxious that they'll lose the best offer yet and pull the trigger.