Well, he has younger talent than San Antonio, but better? That's a reach. None of them have rings, or a championship. They did win more games in the regular season, but not that many more.
If he has more talent, then he should win the series. I think he is saying the Spurs are a better team because they play better team defense. It's not their individual skills, but the way they trap the ball handler and disrupt the offense, that makes them better.
Physically, the Suns are better athletes, I doubt Duncan could run down the floor with Stoudamire, but I'd still want Duncan in the post over Amare right now.
I'm not sure if the Suns are ready to take out the Spurs. So far, it looks like San Antonio is just a little bit better, a bit more in control, a bit more poised. A confident team is tough to beat. D'Antoni is just trying to build the confidence in his own squad. If it pisses off San Antonio, it's not like they can play any better- he had nothing to loose, except make SA loyalists unhappy.