I reckon the NRL will (eventually) accept Watmough's insurance-covered retirement as a means of us shedding the $570K we need in order to play for points again.
When they delete Watmough's contract for the season (let's call it $600K including TPA) from the cap, of course we then have to replace him in the top 25 with someone on (say) minimum $80K wage. So we'll likely still be $50K out.
If Morgs was in the top 25 and Melbourne are paying him $130K for the remainder of the season, that would cover us for the remaining $50K of the cap breach, plus the $80K for his minimum wage replacement into the top 25. If Morgs wasn't in the top 25 - or if Storm didn't pay him $130K, then we need to shed some dollars elsewhere.
Being able to play for points in the next 10 days before the Souths game is very doable - but only if Watmough's insurance company rules that it was a new (not pre-existing) injury that has forced his retirement, and the NRL rules the payout cap-exempt.