I think here's the comment he was referring to[1]. You're right, case-insensitivity was introduced in HFS or earlier. Back then filenames could use any byte except ":". With HFS+ it accepted all Unicode, where case-sensitivity gets quite a bit trickier. With the later switch to OSX it would have been a great time to change the default to case-sensitive if they wanted to, but as they said, you're then betting on a few killer apps like Office and Adobe products supporting it. Office has always been notoriously slow to update and Adobe has been notoriously slow at adopting new technologies like Carbon and Cocoa. I'm sure Apple at the time was in close communication with those teams.
[1] https://news.ycombinator.com/item?id=8877431