Is McCain confused again? Maybe, but more likely it's just politics as usual, a way of being all things to all people. He wants credit for taking climate change seriously but he also wants credit for being business friendly, so he offers up a cap-and-trade plan and then insists that it doesn't actually involve a cap. This is garden variety double talk, but he can get away with it because he knows that no one in the press corps will actually challenge him on an issue of substantive policy.
And while I'm on the subject, there's another clip from the same press conference here. Am I crazy or does McCain look like he's been up for 30 hours straight? Especially toward the end, he's just rambling semi-coherently.