The self-assembly of non-toxic well-consumed small caffeine molecules into well-defined structures has important implications for future medical applications seeking to target the transport of small drugs in human body. Particularly, the solvation of the microenvironments of the self assembly ultimately dictates the interaction with the drug molecules and their therapeutic efficacy. We present femtosecond-resolved studies of the dynamics of aqueous solvation within self-assembled dimeric structure of caffeine molecules. We have placed small hydrophobic probes 4-(dicyanomethylene)-2-methyl-6-(p-dimethylaminostyryl) 4H-pyran (DCM), coumarin 500 (C500) into the caffeine dimer to enable spectroscopic examinations of the interior. While molecular modeling and NMR studies of the probes in the caffeine dimers reveal a well-defined location (stacked in between two caffeine molecules), dynamical light scattering (DLS), Fourier transform infrared (FTIR) spectroscopy, densimetric and sonometric experiments explore the structural evolution of the dimer upon complexation with the probes. We have extended our studies in various temperatures in order to explore structural evolution of the self assembled structure and consequently the dynamics of solvation in the interior of the dimer. Picoseconds/femtosecond resolved dynamics and the polarization gated spectroscopic studies unravel the hydration and energetics associated with activated viscous flow of the confined probes. Our studies indicate that the interior of the caffeine dimer is well-solvated; however, the dynamics of solvation is retarted significantly compared to that in bulk water, clearly revealing the dimers maintain some ordered water molecules. We have also explored the consequence of the retarded dynamics of solvation on the photo-induced electron transfer (ET) reaction of a model probe, 2-(p-toluidino) naphthalene-6-sulfonate (TNS) encapsulated in the dimer.