I don't think the size of the cage will matter in building your relationship with him and may I suggest you allow him to come out of the cage on his own without sticking your hands inside to get him. Some greys are territorial about their cage, it is their safe haven and do not like anyone putting their hands inside, just open his door and let him come out and then have him step up.
At this time I would just concentrate on building trust without using your hands if he fears them, sit by his cage and talk softly to him, read him the newspaper or a magazine, maybe offer him a treat, this will take some time and patience on your part and just take it slowly and go at his pace. He will come around and it is important not to push him for more than he is willing to give, let him be the judge of when he is ready for more.