The rumors were that the Magic were holding out for a package of players and picks on the level of what Denver received from New York for Melo.
Orl passed on Brooklyn's offer which if memory serves, included Brook Lopez, Marchawn Brooks, and 4 unprotected 1 round picks. They also passed on a slightly less valuable package from Houston. The Houston offer was part of a three team package that included the Lakers. My understanding was that Orl didn't want Bynum, supposedly because of his knees. They claimed to want young cap friendly players in return for Howard and that is what they got.
It appears that Orl either overplayed their hand or that their intent at some point became tanking a couple of seasons and rebuilding the team in the OKC mold. I'm voting for the tanking plan.
BTW, good luck on having a Kevin Durant fall into your lap on que while using the OKC method of building a team.