Search engines do care about case.

Capitalization doesn't affect your rankings directly; however, if you have links to a page both in caps and lowercase, the search engine will view it as two distinct pages. You begin to run into duplicate content issues. Depending on your server, and are two different pages, but search engines will always view them as separate URLs.

From a usability perspective, use lowercase. As a user, I don't want to pay attention to capitalization when I'm typing in a URL.