So far, Butler has been sort of a fringe player, with very little production. We can see from the preseason why the Cowboys thought enough of him to trade a late round pick for him last year. The potential is there, and now we have also seen production from him in the preseason, making this a potential breakout year.
I see him in sort of the same situation we had with Murray before his breakout campaign in 2014. We could have extended Murray cheaply in 2013, and still had him on the roster in 2015.
I would approach Butler about a relatively cheap extension, which would benefit the Cowboys greatly, and give Butler some security which he doesn't currently have. Terrance Williams is also in a contract year, so we may not be wiling to give him what he wants to stay, especially if the Cowboys have a very good offensive year.
If we lose both Butler and Williams the next offseason it would force our hand next year. We will probably not want to spend a first or second round pick on a receiver next year, or the salary that high of a draft pick will get as a number two receiver, or go through rookie growing pains normally associated with a rookie receiver.
If the Cowboys project him to have a break out year like I do ....... then now is the time to do the cheap extension.