Chavez played 64 games at first base with the Yankees in 2012, including 50 as a starter, hitting .281 with 16 homers and 37 RBIs. He has a .818 OPS over his 15 seasons and has won six Gold Gloves at third base.
Chavez also gives D-backs manager Kirk Gibson an option at designated hitter during Interleague Play.
Nieves, 35, was signed by the D-backs in August. He made 38 plate appearances and hit .306. He was eligible for salary arbitration, but the D-backs non-tendered him last week because they felt he would earn too much money in the arbitration process. His new contract was made official on Thursday afternoon.
Arizona had also targeted veteran Rod Barajas as a backup catcher, but the sides could not reach an agreement. There is not a lot of playing time for a backup catcher in Arizona, with Miguel Montero projected to start 130-135 games.
Wednesday's moves leave the D-backs with one more infielder than they can carry on their Opening Day roster, with Chavez, Johnson, Cliff Pennington, Willie Bloomquist, John McDonald, Aaron Hill, Paul Goldschmidt and Eric Hinske in the fold.
"At least right now we've got pretty much 25 guys who we feel pretty comfortable with," Towers said. "That's not to say we don't do something more, but we've improved our bench, we've got the backup catcher, we've improved the bullpen."
The D-backs are likely to hang onto the extra infielder through the first part of Spring Training to increase competition and provide insurance against injury.
"In my history, people in Spring Training are always looking for middle-infield help," Towers said.
The D-backs would still like to add a starting pitcher and remain on the lookout for an upgrade at shortstop. One of both of those needs could be met by a dealing Upton, and rumors of a five-team deal as well as a four-team deal were floated at the last full day of the Winter Meetings.
There were also reports that Indians and D-backs discussed the framework of a deal involving D-backs top pitching prospect Trevor Bauer and Cleveland shortstop Asdrubal Cabrera.
By the end of the day, it seemed like momentum for any of those deals had stalled, pointing to the difficulty of completing a trade involving more than two teams.
"It's hard," Towers said. "I would say that sometimes there's two teams that are comfortable, two that aren't quite so comfortable. Sometimes it's three that are very comfortable. What's hard is when three feel pretty good about all the pieces and one that doesn't feel quite so good, and that kills the deal."
And for whatever reason, there have been a lot of multi-team deals discussed by the D-backs during these Meetings.
"In all my years, I would say I've had more multi-team trade discussions than at any time ever," Towers said. "I've had very few just direct one on one. It seems like almost every trade discussion that we've had has involved at least [a third] team."
The D-backs are still shopping outfielder Jason Kubel in order to free up more playing time in left for Gerardo Parra, but nothing has materialized.
Towers said the signing of Chavez made it less likely that the team would pursue Japanese shortstop Hiroyuki Nakajima.
With two spots open on their 40-man roster, the D-backs may select someone in Thursday's Rule 5 Draft. Towers put the chances at 60-40.