To me, this looks like an obsolete, legacy requirement from long before the
time $wgCapitalLinks was introduced.
The relevant code is found in includes/user/User.php:
public static function getCanonicalName( $name, $validate = 'valid'
// Force usernames to capital
$name = $wgContLang->ucfirst( $name );
isValidUserName also checks this condition. But no where do I see *why*.
It seems to me that either $wgCapitalLinks should apply here, or (for
backward compatibility), a new option ( $wgCapitalNames ) should be created
to allow the site-admin to disable the forcing of ucfirst of usernames.
There is no good reason. But now it's scary to change it, since there could
be places where we assume that usernames can not begin with a lowercase
letter. There is task https://phabricator.wikimedia.org/T28396 about this.
Although folks are complaining about it, it seems that no one has proposed
a patch. (As long as the default is still to user capitalized usernames, I
don't see why we couldn't have an option to allow lowercase ones.)