The 40-year-old replaces Carlos Moya, who stepped down on Thursday after Spain suffered relegation from the World Group following a 3-1 defeat to Brazil.
Former world number one Juan Carlos Ferrero was among the favourites to succeed Moya, only to miss out.
Garcia, a former world number 27, instead became Spain's first female Davis Cup captain.
Toni Nadal told Spanish radio the appointment could create problems "at dressing room level".
Neither he nor Rafael Nadal have a relationship with Garcia, but Toni Nadal said he expected a different appointment.
It would seem to be more normal if the captain had been someone like Juan Carlos Ferrero, or some ex-player of a certain level, which is what has happened recently, he said.