If a player acquisition is going to bring your roster into an illegal state, have a plan for making it legal before you bid or trade for the additional player. Otherwise you’ll find yourself in a roster crunch and might have to cut a player that you don’t want to cut. It’s a crappy situation and entirely avoidable, but many Ottoneu players experience it when they’re first starting out.
The key thing to remember is that cutting $1 players will not help the situation; in fact, it can make things worse because you’ll still have to fill the roster spot and you now have a $1 penalty.
As I was typing, you asked:
“If you cut a $1 player, can you then simply add a $1 player? Or that’s a cap hit and you really need to drop a $2 player in order to afford that $1 player? Again, this all assumes you have 40 players and $400 salary.”
The second one. You have to cut a $2 or $3 player to recover $1 in cap space.
“If you cut a $6 player (and nobody else puts a claim in or picks him up), do you get $3 free dollars?”