This may just be one of those ah-ha moments, or it may just be one of those DOH! moments.
As a C# developer at the core and an accidental SharePoint Admin in the last several years, case sensitivity is just one of those things that sticks in the back of my brain. Turns out that SharePoint 2010 will not let you add two metatdata turns under the same parent if the only thing that is different is case sensitivity, i.e. “Metadata” vs. “metadata”. However, this is only under the same parent. It has no problems with adding the same term with different case as long as they exist under two separate parents.
This can lead to some ugly suggestions if you have multiple parents and term sets in your farm and a user is trying to fill in a metadata field like “Ask Me About.” The lesson here is be diligent about your managed metadata, establish things as simple as Case based governance, and regularly go through your open terms and clean up what you can before it gets out of hand.