Brett can still play...
I don't have all the details...but from what I do know, it sounds like Favre "decided" about his retirement a lot sooner after the season ended than he has in the past.
This seems likely because, in the past, he has "held the Packers hostage" (as others have noted) and decided much later on in the summer, that he was still going to play.
So it appears to me that he MAY have been pushed by the Packers to decide earlier than he would have wanted, so that the Packers could draft accordingly. If that is the case, then I see no problem with the Packers asking him to do so.
So, he retires...but then as the pain from the loss in the championship game begins to fade...he thinks, "I can still play". It's probably happened just about the same way for Brett the last 3-4 years...except this year he actually retired at the time when in years past he was just "thinking" that he would.
So now we have the problem.
The Packers have invested time into Rodgers and altered their draft accordingly. They can't just hand over the team to Favre.
Favre on the other hand, does not want to come back to WATCH his team play. And frankly, he is still good enough to QB more than 1/2 the teams in the league.
The only logical answer is that the Packers trade him.
The Packers had already figured he was gone and have moved forward without him. So what's the big deal? If they trade him, Brett gets to play and the Packers get something in return.
At this point, nobody is going to look 100% like the "good guy"...so cut your loses...man up and move on!
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