nakadish
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It will be interesting to see how this plays out. If the Saints deny now but move on from him later, that would look terrible. Seattle is putting some pressure on the Saints with this. I wouldn't be surprised if the Saints ask him to interview for the HC job here. If Seattle were to offer their OC spot, which is an attractive job, he could lose out on securing it by waiting for the Saints to sort out their HC situation.
For a lateral transfer, no it wouldn't. You don't want to lose good coaches. The Saints could block it if they wanted to. But the problem is that there's no telling what coaches the new HC will want to keep. So, the "nice" thing to do is allow them to look for other options. But the Saints are one of the more player/coach friendly teams in the league. Not all teams would do that.