"Damaged goods" is a pretty relative concept though. With a sports hernia, he still could be a fully functional lineman, but maybe just not as good as he was due to the associated pain. Also - it isn't something that can be diagnosed easily by a doctor. Add to that the surgeon who did the job would not disclose Peter's condition without permission. Also, find me one surgeon who would admit that maybe the job wasn't 100% and I'll show you a doctor who is broke.
edit - I'm not saying he is hurt, I'm just saying part of this holdout could be related to him not fully recovering from the sports hernia, and knows his best days are behind him and he wants to cash in while he can.