Let's not jump to conclusions that something is faulty before we have investigated a bit more...
0010 0000 should be a [space] character. The entire screen should be blank in this case. Did you remove the 6502 CPU?
0100 0000 should be a 1-pixel thick horizontal line.
If you try 0010 0001 this should be a stable '!' character.
I think I have worked out why you may have upper-case letters instead of lower-case letters. Especially if the 6502 CPU has been removed (which may have answered my own question above). The character generator has two sets of character codings within it. The GRAPHIC signal switches between the two sets. If the CPU is removed, the GRAPHIC signal will be floating and will select the secondary character set. However, floating may result in some random effects? You could try the same test (0010 0000) with the CPU installed to see if you get a more stable result).