He's pretty much a DH only now. He was chugging along pretty good until he had to cover 1B. Once he had to field his position for a few weeks, his back flared up and his production took a nose-dive.
As a veteran DH, I still like him. The M's have had a terrible time finding a competent DH since Edgar. I would hang on to him, give him the qualifying offer and suppress his market value even more. Sucks for Morales but thems the rules of the game. Boras isn't getting a big, premium contract for Kendry's, especially with the additional cost of a first round draft pick added in.

Agree with almost everything you said, Doc ... except I'd rather have Morales than Morse.
Morse, just like Morales, has a career line inflated by a single monster season. So, I fail to see the edge here for Morse.
In addition, per bbref, Morse is currently dead last in dWAR. While Morales may be a liability at 1B, Morse is just as much a liability in the field.
Additionally, Morse has an even worse health history than Morales. While Kendrys freak broken leg accident cost him a season, he came back and put up solid numbers over 134 games with LAA after healing. Morse has ONE season with more than 102 games played ... and he's a year older.
My take? Offensively, they are nearly identical. Morse has shown no sustained production advantage over Kendrys in any area.
Defensively, they are nearly identical. Neither is a defensive plus, and both are better served with as little time in the playing field as possible.
Health wise, I see Kendrys holding a small edge, since his primary injury was very flukish.
In the end, the primary measurable difference is Kendrys is a year younger.
I look at the two, and while the differences are small, I see Morse as older, with no more power, who strikes out a tad bit more, and gets hurt more easily and often.

Morales was looking like a .300 hitter with good (but not great) pop until back troubles cropped up because of having to play so much in the field. He's clearly a different hitter if forced to play first base more than occasionally. He DOES take back some of his contributions at the plate with his proclivity to hit into twin kililngs. It's extra-important to maintain power if you could legitimately be nicknamed D.P.
It will be interesting to see if Smoak's return will give Morales enough time to heal up and return to his previous hitting form before the trading deadline, or if the circumstances surrounding his forced everyday first base duties have resulted in a "wait 'til next year" posture.
He's definitly a risk, but I myself would still classify him as a .300 hitter with at least .475 slugging power, perhaps more, and a tough-as-nails at-bat when the chips are down.

A look at Morse career or B-Ref' show that he has NOT demonstrated the ability to stay healthy for most of a full season. As you say, he's only done it once. I don't think it would be wise to go into any season counting on him to be a 500+ AB guy. What good is his admittedly prodigious power if it's only on display a fraction of the season?

Reasoning:
1) his power only dropped due to his back injury from playing 1B too much.  He should only ever be a spot fill-in there, even though he plays it pretty well. 
2) Other teams have now seen that, which should remove him from any NL lists and cut his suitors in half.  That brings his price into reasonable territory.
3) Even when he's struggling he puts hard ABs out there, unlike some other vets I could mention.
4) .800 is the new .850. The days of Gar posting an OPS over 1.000 as a MOTO hitter - with other .900+ hitters around him - are pretty much gone.  The Tigers have Cabrera CRUSHING at another MVP pace (See why I said I would trade Felix for him a couple years ago?) but the rest of their offense has two guys over .800, and they're basically the best offense in the league (#1 in average and OBP, #2 in OPS, #3 in SLG). So we're looking for three guys over .800, with a few more around .750 to get an offense going. Morales can be one.  And moe, he's on pace for 36 doubles this year, so no I don't think 40 is out of the question for him as a healthy benchmark.
5) We don't have a DH ready.  DHing is hard.  Peterson and Choi are our only 2 first-base or DH options, and both are 2 years out even if they are successful.  Peterson wants to play the field more than he wants to breathe, so I wouldn't pencil him in for that role at this point. Choi doesn't even have 800 PAs in the minors since his 2010 debut, so IMO he's about 2 years away. A trade deadline callup in 2015 sounds about right, but almost certainly NOT next Spring.  I would take 2 years of Morales and then see where we're at.
There are other reasons.  The ones against are basically that DH should be easier to fill, Morales doesn't have extreme upside, is an injury risk, is gonna be on the downside of his career... but those are the reasons that we can surmount the "Boras is his agent" problem.  Honestly, Choo is one of the only premier hitters on the market next year.  When there's only one or two guys, it makes it really hard to plan on adding them.
Keep Kendrys if we can.  What's Detroit going to offer us, more 2nd-tier players?  We're stuffed to the gills with everything we can fit on a 40-man right now.  Who needs another Thames or Ruffin or T-Rob in trade? Not this team.
We have so much top-shelf pitching in AAA (E-Ram, Maurer, Hultzen shortly, Walker, Paxton ALL sitting there) that it doesn't make sense to splurge on pitchers.  Young pitchers can be immediately impactful.
Might as well pay a hitter to fill a role that he's good at and cross it off the list.
~G

Even if we have to pay more than the going rate too keep Morales at DH, it would be money well spent so long as the rate doesn't get downright ridiculous. As others have pointed out, unless we can get productive, imminent help at corner OF in return, what are we going to get either in trade of from the minors that's any better over the next two years than a healthy Morales? And if you have to give him three years to keep him, you do it and worry any problems in year three later. As Gordon points out, we are stuffed to the gills, overstuffed in prospects. Why let one of our few legit bats get away if for some unexplainable reason he might be willing to stay? Get a healthy everyday firstbaseman, or make Ibanez/Morse a first base job-share, and Kendrys can be a more healthy DH.

I would think this is the perfect time to approach Boras about Morales. He's essentially proved to the world that he's a DH / once-in-a-while-1B that can't take the constant twisting that 1B requires daily. Yes, teams will be interested in him as a DH. Will it be worth trying if the Ms are clearly prepared to give him a QO? If the Ms offered $15mil for 2 years today, and if Kendrys really likes Seattle, I can see him getting Boras to jump on it. Certainty is worth something as well.
Then the Ms need to get a Dr. Elliott program for him for the coming offseason that will help him lose some weight and improve his twistability.

.569 Slugging is a career power spike for almost anybody....well, WAY above almost anybody's career power spike. Remember Figgy's career year for the Angels? We paid for that one, one that was a complete outlier.
Morales had 43 doubles that year, to go with the homers....can you see him legging out 43 doubles now?
Morales' year was an outlier, too. He may well hit .300 again. He won't slug like that again.
Rumor is that Detroit is interested in him (well, I read that yesterday, somewhere). For something useful, I would be sorely tempted.
He will cost us....what? $8M next year, maybe, in a QO. I would do it. I would certainly prefer him over Smoak. I'm not betting we go that way.
Interest my be hot right now. Take advantage of it...if it is, and it we aren't all in on him for next year.
moe

Let's say we do a deal with Detroit.  What can they offer?  From John Sickel's list prior to this year:
#1) Nick Castellanos - we're not getting him, and even if we did he plays 3rd.  He's who I wanted in the Fister deal instead of F-Mart.  No such luck.
#2) Avisail Garcia - Austin Wilson size, .720 career OPS into age 22 season, career batting eye is .18.  He's the F-Mart of a corner position.  No thanks.
#3) Bruce Rondon - basically Stephen Pryor.  That's their third best prospect.
#4) Jake Thompson - very talented low-A teenage starter.
#5) Danry Vasquez - teen corner OF with zero power thus far, in low A.
#6) Eugenio Suarez - 21 yo AA shortstop, I'd rate our own Chris Taylor higher, but he's decent.
#7) Tyler Collins - Sickels says he's a tweener - probly not a starter IMO. Might be a good OBP guy by 26.
#8) Casey Crosby - lefty who throws hard, more wild than Paxton. Is lesser Paxton a thing?
That's everybody above C+. For the rest, Austin Schotts is terrible, Paulino was a teen with a good arm who now has shoulder woes and hasn't pitched in a couple seasons, Rogers is a reliever...
---------------------------------
Who do you want out of that list, and who will they give you for a DH on a three-month contract? Devon Travis is pulling a Kyle Seager for them, but down in A-ball as a college kid.  He's interesting.
He plays 2nd base.
Other than Thompson and Castellanos I don't see anybody that would really improve our talent level, and neither of those guys are coming over for Morales.
I'd rather give the QO and add a draftpick next year than take Danry Vasquez or Tyler Collins on another F-Mart or T-Rob lark.
So I guess I'm saying that yes, there are talents in other orgs that I would be willing to trade Kendrys for, but since I don't think they'll trade those talents to US, I'd rather keep Morales and try to sign him for next year.
~G

Maybe we could add a sweetener like Perez to Morales to get one of their top tier prospects, or a three way trade?

Detroit: Kendrys and Perez.
Florida: Castellanos, Walker, Maurer, Morban, Saunders.
Seattle: Stanton and LoMo, plus maybe an arm like Crosby from Detroit.
That leaves us E-Ram, Hultzen and Paxton for the back of the rotation, Moran replaces Perez, plus Seager, Miller, Zunino and Franklin for the infield.  We'd be really young, but man, there would be a ton of talent on the field.
LoMo replaces Ibanez/Bay (Ibanez goes to DH the rest of the year), Stanton swaps out for Saunders in RF, Ackley bumps up to CF, and Endy is the 4th OF.
Detroit gets the DH and the killer lefty to try to win a WS with this year.
Florida gets maybe the best pitching prospect in the game, the best 3B prospect in the game, a 5 tool Latin player, a current major-league CF on the cheap, and a #3-4 pitching prospect also ready for the bigs. All those players are ready to go now for the Marlins if they want em, except Morban. There might be a 2nd-tier-but-good prospect like Pike or Chris Taylor if necessary to either Detroit or Florida to make it work for all teams.
If there's a package we can use to pry Castellanos out of Detroit to use him instead of Miller or Franklin in a trade to Florida, this works for me.  Otherwise, there's no real point IMO.
~G

One of the good things about the new CBA is that if we traded Kendrys, the whole QO/draft pick stuff is gone if we wanted to sign him back for next year. It would be pure years and $$$. If we wanted him back, there's not much to stop us except Boras.

With Marisnick, Yellich, Ozuna, Jensen, and others (plus Morban) for the OF, I'm not sure they'd want Saunders, and we'd be selling low. I'd rather try offering Elias - a Cuban, and doing pretty well at AA - and, if necessary, Taylor. I think that would be closer to floating their boat. And for Detroit, I might see if Logan Bawcom or LaFromboise held some interest as a BP arm for September, if it could get us an interesting younger arm, like Crosby, back.
Thinking about it some more, I would guess Detroit would probably want something long-term as well as the rentals for Castellanos. In that case, Pike or another highly regarded young pitcher might have to go to the Tigers to make it work. But it would be worth it.

So, to put Gordon's idea together with mine, we get:
Detroit: Kendrys, Perez, Tyler Pike, and an AAAA BP arm for the stretch/Sept. (Bawcom, LaFromboise, Leutge, Burgoon, ???).
Florida: Castellanos, Walker, Maurer, Morban, Taylor, Elias.
Seattle: Stanton, LoMo, and Crosby.
That leaves us E-Ram, Hultzen and Paxton for the back of the rotation, Moran replaces Perez, plus Seager, Miller, Zunino and Franklin remain for the infield, along with the better of Smoak or LoMo. We'd be really young, but man, there would be a ton of talent on the field.
LoMo replaces Ibanez/Bay (Ibanez goes to DH the rest of the year), and backs up or replaces Smoak at 1B. Stanton takes over in RF, Saunders moves to CF, Ackley takes over LF, and Endy is the 4th OF, and Morse the 5th. Ackley also provides IF depth. Bay and Guti are casualties of the crunch.
Detroit gets the DH and the killer lefty to try to win a WS with this year, plus a young arm whose arrival in AAA will be in time for their next need in their rotation, plus a AAAA bullpen arm to rest guys in September.
Florida gets maybe the best pitching prospect in the game, the best 3B prospect in the game, a 5 tool Latin player, a shortstop prospect who looks able to field AND hit, a #3-4 pitching prospect also ready for the bigs, and a really good Cuban pitching prospect probably just a year away. All those players will add to the Marlins present stockpile to make their system the strongest in baseball. In a little over a year, Loria will be able to go -"see, I told you!", while the Mariners and Detroit fight it out for the postseason.

Wow. That is a lot going out for Stanton, Lo Mo and an A ball pitcher (ie high risk). But certainly doable. Why do we want LoMo? I'd prefer to send out less for just Stanton if that would work.

Jack has already said that prospects are under-valued in this year's market, AND we'll be bidding against the Rangers for certain, who can throw Profar and Olt into the mix.
Gotta pay for what you want.  It's my philosophy not to cry about losing Morban when the alternative is losing Stanton to the Rangers.
And as for "why LoMo"... a) I like him (always have), b) he can play OF or 1B if we need to drop Smoak before Peterson and Choi are available, c) the Marlins will NOT want to keep him around as a malcontent once Stanton is gone, so this helps clean the slate.  He has power and swagger, two things I want more of on this team, and he's about to get to his Age 26 With Experience year, at which point he should blossom.
Yes, we'd pay a lot, but getting two corner bats for multiple years, for the price of prospects, is okay with me if they're the right bats.  Stanton is the right bat, again IMO, and LoMo could be one of those sneaky 2nd-additions that makes this team work.
I'm not against just getting Stanton, btw.  Just throwing out the idea of two corner bats for a ton of young talent.
~G

I didn't know LoMo was a competent OFer. Makes sense... Condor in CF and Ackley is McLemore? I like it.

KLAT guys: when I use my tablet to post a comment (ASUS Transformer Pad Infinity TF700t using the docked keyboard and Chrome browser) - about 1 in 3 times, the save button takes a moment to respond, then it gives me the rotating circle for a LONG time, and then it double posts. Alternatively, when I'm trying to shout, I have to press the Shout button until it turns blue-border, then press again to get it to post the shout. Hope this might help you refine the app.

Morrison is a younger Morse - can play an adequate OF or a pretty good 1B (he's LH), has enthusiasm to burn when he's treated right (which is why Gordon is absolutely right that Miami will want him out if they get rid of their other vets (Nolasco & Stanton)) and has thump in his bat when he's healthy. He's a bit more agile than Smoak, but not quite as good at 1B. I especially like the versatility of being able to back up Smoak (or take over if Smoak face-plants) or DH or be a 5th OF. I don't think we could afford to keep Morse if we got LoMo, though.
Interesting point if we got LoMo and Stanton - of the 2010 BA Top 100 prospects list, we'd have: #3-Stanton, #4-Montero, #11-Ackley, #13-Smoak, #20-Morrison, and #30-Saunders. Of course, Trout was #85 on that list, so what do they know? ;-)

Yeah. It sounds like he's a change up away from basically being another Felix.