I've tried this on one of our binary databases (ie ALTER DATABASE X SQL_Latin1_General_CP1_CS_AS) and it fails on about 2100 objects (check contraint objects).
Also, if this was successful, would it actually make the table names and field names as well as the data case-insentive ie you could do a select query on any case for the table, field and data and it would yield results where in case-sensitive, it would not?
I was told the only way to truly change a database to case-insensitive is to either DTS into a case-insentive db or use bcp becuase the indexes do not get changed thus queries won't change.