I love the keyboard at the bottom of the Kindle. The User's ' Guide suggests holding it in both hands and using the tips of your thumbs to press the keys... makes sense. That seems to be how people text with their phones. Don't you just hate it when they are driving though? I use the "two thumb method" at times, but use whatever fingers are handy for the most part and just don't think much about it.
Lowercase and Uppercase Letters: It really doesn't matter if you use capital letters or not, but if you want to capitalize a letter, press and hold the Shift key, then (while still holding the Shift key down), press the letter key, just like you would on a computer keyboard. The Shift key on the Kindle is on the bottom row, far left and has an arrow point up on it. The next key over is the Alt key, then the spacebar.
Another way: You can also press and release the Shift key, then press the letter you want to capitalize. Only that letter will be capitalized, then the rest will be lower case.