It's slightly complicated, but the smaller caps of "small caps" are the lower case. As Wikipedia says, setting text in small caps is "technically not a case-transformation". In those days it would not be surprising that a system would only have one font.
I don't know about the Silent 700's font, but it looks to me like this probably wasn't a mistaken case of the DRY principle: after all, the TI-99's lower case letters are still stored as separate bitmaps (they are reproduced in an image here: http://electrickeet.com/line-itfont.html).
So it is clear, at least, that they had the storage for lower case, and for whatever reason decided to go with a small caps font. It isn't a result of a simple limitation that they hacked around by scaling bitmaps or something like that. I wouldn't like to speculate about what fraction of users found it odd at the time.
I don't know about the Silent 700's font, but it looks to me like this probably wasn't a mistaken case of the DRY principle: after all, the TI-99's lower case letters are still stored as separate bitmaps (they are reproduced in an image here: http://electrickeet.com/line-itfont.html).
So it is clear, at least, that they had the storage for lower case, and for whatever reason decided to go with a small caps font. It isn't a result of a simple limitation that they hacked around by scaling bitmaps or something like that. I wouldn't like to speculate about what fraction of users found it odd at the time.