I've had this problem as well and I believe it's a case of the string being typed too quickly.
It seems that the names of the key,change depending on the status of the shift button.If shift is enabled then the key is called 'N',if shift is not enabled then it's 'n'.You'll notice as a string is being typed,that the shift button is tapped before an uppercase letter is typed.Your test is attempting to press the 'N' key before the 'Shift' button has been pressed.It doesn't affect the first letter of your sentence because the keyboard has shift enabled for the first letter.
This also affects typing a lowercase character after an uppercase character:the lowercase character may be typed whilst the shift button is in the process of being unpressed.
I use a workaround of typing each letter of the string with separate typeString() methods.
for (i = 0; i < title.length; i++)
{
var strChar = title.charAt(i);
target.frontMostApp().keyboard().typeString(strChar);
}
The downside to this is that it takes a lot longer to type the full string.
You may also want to look at the following link which provides a similar solution but uses the app.keyboard().keys().tap() method for each character of the string instead of the typeString() method.
http://jojitsoriano.wordpress.com/2011/06/27/ios-ui-automation-typing-a-string-in-a-uiatextfield/