Yeah, I was gonna say that. The proportions are pretty different. Though I rarely use them inline… I’ve used them in a few logos when the uniformity of the letterforms just clicked in-context.

Love small caps. Rarely used and encountered, I really enjoy seeing them in the wild.

Normal caps are for in-text use too. A really good typeface will have different versions for all kinds of different display conditions. Sometimes several levels of display for headings and above, like posters and signs. There will also be different weights which are important, for example if you are setting light on dark as opposed to dark on light (e.g. on UK road signs a medium font is used for light on dark and heavy for dark on light). It's all about giving the desired optical effect.

In computer science literature it's common to typeset the names of problems in caps (e.g. 3-SAT), but I find doing it with normal caps so ugly. It's much more pleasing to use small caps, and some works do (including my own PhD thesis). What I find even nicer is that you can still capitalise proper nouns and the beginning of sentences when using small caps.