>>No, this is not true. It depends on database collation. If you're using case sensitive collation for the database, it will be case sensitive.
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>This is turned off at installation as it forces everyone to use the proper casing and nothing would work after that.

Server collation and database collation and column collation is not the same thing. You can have SQL Server case insensitive (and you should have), but have case-sensitive database or certain columns to be case sensitive. Of course, this would be set in design time (or can be altered), so by default database inherits the same collation as model database.