I agree that Lugo at 9 mil is a ripoff. Jeter at 20 mil isn't exactly a bargain either. The question is, is Jeter more than twice as good as Lugo? I would say yes, he is.
Jeter in 07: .322 BA, .388 OBP, .452 SLG, 53.3 VORP
Lugo in 07: .237 BA, .294 OBP, .349 SLG, -1.3 VORP
Not even close. Lugo has the edge in speed and fielding, but in hitting, they're not even comparable.