Never heard of casefolding, sounds cool. I'll look into testing that some time!
I prefered not to use NTFS and instead use JFS with OS/2 compatibility mode turned on making it case-insensitive. I've never had an issue with needing it to be case-sensitive like step 3 indicates may be an issue, but I've not done extensive testing. If anyone else prefers this option, simply install jfsutils instead of ntfs-3g replace the ntfs commands in steps 2 and 3 with:
mkfs.jfs -O ee_modbox.img
mount ee_modbox.img /mnt/modbox/
and the fstab line in step 6 with
/path/to/ee_modbox.img /mnt/mo
