Update! I actually found an answer to this question myself, with help from MS outlook chat. Which did take quite awhile, but I'm posting the solution here, in case anyone else in the future stumbles across this technical support problem.
When you're composing a new email message (or a reply) you should see a white-background horizontal row near the top of your screen, with words like: Delete, Archive, Report, Sweep, Move To, Reply, etc. Near the far-right end of that row is a teeny tiny down error. Click on this upside-down triangle looking icon, and after several seconds, this white row of options should expand to be 2-3x the height that it was. Or maybe if you happen to keep this toolbar expanded all the time, if that's your personal preference, skip that whole last part.
You must click on the word "Message" in this top row, then click on the word "Editor" at the far right-hand side. Click on "Editor Settings" and there's a choice there for "Enable Auto Capitalization" which you should turn OFF. Note that you must do this while you're composing a message (or reply) - none of this will work if you're just viewing some random email message in a folder. Why in the world MS chose to bury this important toggle-switch here, instead of in the more conventional main "SETTINGS" choice is beyond me. But after months of struggling with this, I'm grateful to have found the solution.