This doesn't seem gutsy to me; it seems downright timid. Now, I'm writing this from the position of not needing or wanting investment in my startup; but if you've decided to turn down an investor because he's a creep (which makes perfect sense to me), why not call him out on his behaviour?
Sending a polite reply about being strategic in how you select investors sends the message that you've selected against this guy because he's not a useful angel investor; the message he needs to receive is that you're selecting against him because he's a crappy human being.