well, I don't know from what he should be tired or exhausted because he only played four matches in Halle (doubles included) and two rounds in Roland Garros before, but I was really disappointed because of his match today and I'm sure he is also disappointed because he played so badly in front of the crowd who wanted to see for sure a better match.
Concerning if he should be fined my answer is clearly "NO". Last year for example, he made the final in Halle and then retired from his first round match in 's-Hertogenbosch. And I think that is even worse.
So, of course, it's better not playing a tournament when you don't want to play and give other players who have interest in it the chance to play there.
Good decision, Nicolas! too many players do that, but at least he doesn't take away the main draw place for somebody else!