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This is a really complex topic and a special case of the canonical tag.. It also doesn't help that Google keeps adjusting their advice. See this thread: http://support.google.com/webmasters/bin/answer.py?hl=en&answer=189077 "When Google discovers a cluster of pages with a single canonical URL, our algorithms will use the title and snippet from the canonical version in our search results. Therefore, it's a good idea not to include region-specific content in the title and meta description tags of the canonical URL. For example, use "Example Widget Inc" instead of "Example Widget USA Inc" or "Example Widget UK"." So, what about the non-canonical pages? Well, the implication is that, if you use hreflang AND canonical, you'll avoid dupe content problems but the proper pages may rank in the proper regions, even with the canonical tag. In that case, you'd want to include regional variations in the non-canonical META data (for regional searchers). Unfortunately, I haven't seen good data on this yet. Like Istvan, my gut reaction is to try hreflang first, without the canonical, IF you're not having duplicate content issues or seeing regional variations cross over into inappropriate regions. If you are seeing that, then you'll probably need both.

If your web server is set up to fix case issues (ie turning them all to lower case) then you've got no problem. From the search engines point of view, case in the URL matters (case for keywords do not, big difference). Each different version is considered a different resource, and would be cached and indexed separately, leading to potential duplicate content penalties. If you're trying to fix a large site that has mixed up their upper and lower case in their URLs, the easiest fix is to do it in the webserver, .htaccess if you're using apache.