You don't use text-transform: uppercase. You type the text in upper case using spans as needed.
BTW, what you are running into is why I've switched over to using kepub for most of my personal use books. RMSDK is more lacking every passing year.
Code:
<p class="pf"><span class="smallcaps">This is for George.</span></p>
<p>T<span class="smallc8">HIS IS FOR </span>G<span class="smallc8">EORGE</span>.</p>
Code:
.smallcaps {
font-variant: small-caps;
}
.smallc8 {
font-size: 0.8333em;
}