Run the Registry Editor (REGEDIT.EXE).
Navigate to HKEY_CURRENT_USER\ Software\ Microsoft\ Windows\ CurrentVersion\ Policies\ Explorer.
If it doesn't already exist, create a new DWORD value named DontPrettyPath. (Edit -> New -> DWORD Value).
Double-click on the DontPrettyPath value, and type 1 for the value.
Close the Registry Editor when you're done. You might have to log out and log back in for this change to take effect.
To turn the feature back on, change the value data back to 0, or just delete the value entirely.
Never had the problem myself. If I understand the source of the above tweak right the value 1 for DontPrettyPath will actually force explorer to display all caps. So I think better set this to 0. If you go to HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\Advanced there is this DontPrettyPath again on the right side. If this has the value 1 set it to 0, too. Might perhaps help.
Well I don't have answer Hipster other then on a 2000 system the main windows folder name is in all caps but the rename feature is there. But I also check on an XP system and the rename feature ain't there and my guess is that you can't rename that folder.