I believe LM also stored the passwords in uppercase as well. The NTLM password was used, but LM was also saved for compatibility (by default) with older Windows

I believe LM also stored the passwords in uppercase as well. The NTLM password was used, but LM was also saved for compatibility (by default) with older Windows machines. L0pth Crack utilized this when cracking, it first found the uppercase password, then it only had to brute force the case when cracking NTLM.