All players from your two teams are your property, and can not be chosen or picked up by anybody else, (you can think of players not on your 25 man roster as your minor leagues.) If you drop a player during the season from your roster, other teams may pick him up for a period of 3 days. if he is not picked up, then he becomes your exclusive property again. You can trade players from your roster and players from your farm team. Once you trade for a player you have the same rights to him that his original team did. Trades can be unbalanced (3 for 2 for example) but all trades must be within 2.5 mil in total salary.
The above is from the original post in this thread. As to players from undrafted teams I would think that they are off limits to all for this league.