Is it permissable to write a formal letter [STRIKE]all through with upper case alphabets[/STRIKE] entirely in upper case/entirely in capitals/entirely in capital letters?
Online, writing everything in capitals is certainly the equivalent of shouting. If you are going to write the letter by hand, it really depends on your handwriting. I have a friend who writes entirely in capital letters but his writing is very neat and quite stylised, so you almost don't notice the capital letters. However, as a general rule, regardless of whether you are writing by hand or on a computer, use the standard rules of upper and lower case lettering.