When I plugged it in, the Yubikey detected as a USB keyboard.
So yes, if you are pressing shift, caps lock etc.. It will mess up.
Yeah, that's how I figured out the problem. It makes sense that a Yubikey that shows up as a keyboard would be caps sensitive. Maybe if I would clean off my desk once in a while I wouldn't have stacks of paper flipping my CL button or holding shift. Anyway, my experience will certainly help others. I think highly of the Yubikey after using it for a few days. Can't wait to try it after I forget to take it out of my pocket and send it through the wash. It's only a matter of time...