I cant play as any other race, other than Federation in 1 player? Is that an issue or do I need to unlock these by playing Federation? I don't remember that in the original. Thanks

You unlock it while playing. You can also do instant action and pick which race you want to be and fight it out.
I do advise you save your game a couple of times seeing as this game has bugs triggering the endgame of a mission at certain points.