Back in July 07, I found and verified a bug in SQL 2005 and Windows 2003 when clustering SQL Server. From previous cluster setups, I found that if I was given a Windows 2003 R2 x64 Server with SP2+ on it, then the cluster went well no matter if the machine name was lower case or not, but the key to this entire bug is that if you go into Cluster Manager and add the nodes to the Cluster, and you see a lowercase name in the list of cluster nodes, SQL will ALWAYS fail. I have verified it so many times, that I am convinced. But this only happens when you are on 2003 with SP1. You can even verify that something is wrong by finding the registry keys that have the server name in them and see that some are lower and some are upper.
There is much more to this story and one day I will dialog it all out further than I have, but with Windows 2008 on the horizon and SQL 2008, hopefully these kinds of cases will not find their way into the mainstream. It must be only our organization because the connect item above has not had much traction.