Click that funny round symbol thing in the upper left corner. Select Word Options. Select the Proofing tab. Select autocorrect options. Deselect Capitalize First Letter of every Sentence.
I don't see what you're talking about with the spacing issue. At first, I though perhaps it placed two spaces after each sentence as this is how it's supposed to be done. But, it doesn't do that in mine. Maybe you have it to Justify the text? That's where all the sentences end at the right margin of the page so that you don't hae sentences staggered all over the page. It inserts spaces into the sentences so as to make them all the same length. Man, I remember the hassle it was doing that back in the old typing days. Computers rock!