I agree with you 100%.
There's an easy benchmark: Cooks. Cooks was worth #31 (and a swap of later round picks, so in essence, he was worth a mid-late first round pick.) Cooks is a better player than Butler - that is, he would receive more money if both were on the open market...there isn't much question on that. In addition, Cooks has one cheap year left on his deal and one team option that isn't outrageous to exercise.
So Cooks is the better player and offers financial advantages. Butler does not offer financial advantages, since they need to sign him to a big deal immediately to get him.
Given that information, there is no way Butler is worth a first round pick, since Cooks was worth a first round pick. Second round (pick 43) is questionable, as it isn't that far away from the first round.