CD, if the Yankees sign Holliday, there is no way they resign Damon. This is for a couple reasons...
1. Because of their words, and their actions, it appears as if the Yankees aren't willing to spend a ton of money this offseason. It would probably be a stretch for them to even sign Holliday, and if they do that, I don't see them bringing Damon back.
2. The whole idea of letting Matsui go, while making no way attempt to retain him, is to create flexibility in the DH spot (Rodriguez, Posada, Jeter, and Damon if he comes back). Signing both Holliday and Damon would not allow them to do this.