I am planning on making my own mechanical keyboard with my grandpa. My plan is to make this keyboard completely out of wood.
When you say “completely out of wood, do you mean you’re going to use wood for the plate/structure that holds the switches? If so, I recommend using some exotic hardwood, something really hard, and ideally a CNC router, as cutting accurate switch holes with hand tools or even on a scroll saw is going to be a pain.
Or do you have a metal switchplate, and just want to use wood for the case? In that case, the type of wood is much less important.
Hand Wired or PCB?
If you use a PCB, you could potentially get away without using a switchplate at all. Personally I prefer plate + hand-wired vs. PCB-mount without a plate.
Will there be a noticable difference in response time between Hand Wired and PCB?
No. The latency is not caused by the wiring within the keyboard, but by the firmware / computer-side drivers.
What kind of wood is light and still sturdy enough to be keycaps? I would prefer is to be light in color and weight. I don't want the springs to go back up too slow.
Type of wood should have no noticeable effect on how fast the switches go up. To make keycaps with reasonable detail, I’d again recommend using a CNC router: making keycaps by hand is going to be a very tricky process. Again, I’d recommend using some kind of exotic hardwood.