What's the difference between Happy and Neutral? Is it easier/less expensive to retain a happier player? Do they get a performance boost?

No, in what happens there's really no difference - but it does give you an indication of how happy that player is. It would take more, for example, to upset a happy player than it would to upset a neutral player. What makes an impact is if your player is unhappy - he won't enter contract negotiations with you if he is unhappy. He will become unhappy if he doesn't play (the higher his rating, the faster he will become unhappy) and he will become very angry if you cut or trade him regardless of how happy he was before.

Doesn't play for how long? Will benching a starter in weeks 15 & 16 to avoid injury heading into the playoffs anger the player?

+1

I'd be interested to know as well.

Also, do pre-season games impact their feelings?

1) No, it takes a lot more than 2 games to get a player unhappy, especially if he's happy already.

2) No, they don't care about playing in the preseason.

How does that affect the following scenario:

1) Mid-season, a bunch of injuries strike my LB position, knocking out all 3 of my starters.
2) In order to field enough LBs for my next game, I have to sign one, which means cutting another player at another position.
3) I cut a backup CB and sign a scrub FA LB.
4) After the game, 2 of my LBs are now healthy enough to play so I don't need the scrub any more and cut him.
5) The CB I cut earlier is still available...

...but I can't resign him because he's angry I cut him the prior week?

I have actually not done that here but I was thinking it could be a problem. As a suggested solution if not implemented already would to have these tier 3 players just be happy to be on a team no matter what. Also, I do not think injuries are severe enough to warrant this but it could happen.

Really stars should be more volatile, if that is the right word, in not resigning, and that desire not to resign should gradually dissipate as that players demand lowers.

I can share one experience in MFN 1 i had was with a rookie FB and my exFB, who has LG label now. Done to open a space on the FB depth chart for the 4th Rd FB.

The LG started the season happy. Though his label was LG he is 66 at FB and starting there. The Rookie has a potential of 78 and after one or two games he was upset. Being the only player like that on my team is had issues.

So, I benched my two year starter and started the rookie. I think three games later the Rookie is feeling better and benching my one starter has had no effect on his opinion of me, yet.