Not to appear to be a know-it-all, but I think the Colts need to be creative to get out of their present predictament.
The first thing to get cleared up is the relationship with Peyton. I would suggest that in the short term he retire, with the promise he would be paid his bonus and be hired by the Colts to serve in the same capacity that Elway serves with the Broncos. I think Elway's title is Executive Vice President for Football Operations. As far as I know, there is no one presently in that position with the Colts. I think retirenemnt is in Peyton's best interests. He has to already be set financially. By staying with the Colts organization, he can continue his work with local charities; and he would not be risking a catastropic injury by steping on the field as QB for the Colts.
In this position, Manning can be involved in all aspects of running the team, from helping choose the new GM to the decision whether to retain Caldwell as the HC. This would also clear the way for the Colts to pick Luck with the #1 pick, and would go a long way to eliminating any concerns Luck might have with no getting to start right away, and having to compete with Manning for the QB job. Manning will also be here to help Luck with the transition from college to the pros. This would also go a long way towards insuring fans' acceptance of Luck as the new Colts' QB. In my scenario, he could not face the rath of teh fans for being the reason why Manning left the Colts,
While not a doctor, I understand Peyton will not reach maximum medical improvement from the neck surgeries until sometime in 2013. If he is fully recovered at that time, he can resign from his position with the Colts and sign with a team that he believes he can help win the Super Bowl.
This would be a win-win for everyone involved, and would help keep the Colts a winning organization.