File extensions are all matched against image, cache and movie file extensions regardless of case (i.e., uppercase vs lowercase).
Note however, if there is a directory containing a sequence with a mixture of upper and lowercase extensions (for the same sequence that is) - then lsseq will report them as separate sequences. This is likely helpful as it's highly unlikely that anyone intended to mix case between files in the same sequence and probably something is amiss.
For example:
a.1.jpg, a.2.jpg, a.3.jpg a.4.JPG, a.5.JPG, a.6.JPG
will be listed as a.[1-3].jpg and a.[4-6].JPG