My custom bike has both 650c wheels and 26" wheels. The 26" wheels are Ultegra road hubs and narrowish mtb rims. I use 26x1.3 slick tires on them, and I love them so much the I rarely switch over to the 650c wheels. The 26x1.3s are perfect for touring and commuting, and road riding over spring potholes. For touring on unpaved trails, I put on 26x1.5 tires. If you're going custom, you want the best fit without compromises, so don't insist on 700c wheels if that alters the optimal design. I'm 5'7" with long legs and short torso, and with my foot size and crank length, I couldn't have used fenders with 700c wheels.
Oil is good, grease is better.
2007 Peter Mooney w/S&S couplers/Terry Butterfly
1993 Bridgestone MB-3/Avocet O2 Air 40W
1980 Columbus Frame with 1970 Campy parts
1954 Raleigh 3-speed/Brooks B72