I don't think Hags was really overpaid for WHEN the contract was signed, but I also think his next contract would have been for a lesser amount at this point in his career even if he was totally healthy and NOT had the hip resurface. He was in the waning years of his career. The eye injured screwed him. I could see him getting maybe $1.5-2m from a club IF he hadn't had the hip done. He's still got wheels and he was a good PK guy. He could be a third liner on many clubs. Great wheels and good forecheck, responsible, but jut not the scoring touch.
I kind of compare him to Sheary (who signed for $2m x3 with TB), although Sheary is 4 years younger. Hags had a little more size, but Sheary was fast and all heart.
Also think Sheary had a little more scoring instinct than Hags. Although Hags is a little more defensively responsible - really just depends what a team is looking for.
Hags has 110G, 186A in 713 games = .415 pts/game
Sheary has 120G, 132A in 531 games = .475pts/game
Also, I think all this is a moot point since the hip resurfacing. I didn't figure Hags to every play another NHL game after that. Most of his game was based on his speed.