He said he doesn't want to face the best players in the final, and that he had played Federer enough times. I can understand why Nadal would not want to play Federer in the final of Wimbledon!
Grass is a court Nadal has to adapt to probably more than any other player especially with his heavy topspin stroke action! Federer seems more naturally adept to the grass surface and has most certianly played his best tennis here over the years.
The ball bounces lower on grass than it does on Nadal's favourite surface clay, so he has to bend his knees more and the whole action of the shot is different when striking the ball. It means he can't always get away with his defensive style of play like he does on clay as aggressive players can literally blast him off the court.
However I would love to see this final as I'm sure many others would so I'm keep my fingers crossed!