Is there any problem with building a Succah on grass lawn? Are we worried about spilling water which I belive it says one should be stringent and not drink over grass?
It is permitted to build a Succah on a grass lawn (the Mishnah duscusses building a Succah on a tree, which is similar), and to drink there on Shabbos and Yom Tov.
One should not wash hands over the lawn on Shabbos and Yom Tov.
Note that during the Shemittah year poskim discuss whether is it permitted to wash in the Succah on the grass on a weekday, and many write that this is permitted, based on the Chazon Ish (Shevi’is 19:14; 18:6) who writes that where there is clearly no intention for watering the plants, no prohibition is involved.