What is the proper way to write the plural of a single letter? Or a word used as a word ('mention' usage)? (another apostrophe question)

When writing (a blog post, script, etc..) what is the proper way to indicate two or more instances of a single letter? For instance, in Monty Python's Bookshop Sketch:

C: I wonder if you might have a copy of "Rarnaby Budge"?

P: No, as I say, we're right out of Edmund Wells!

C: No, not Edmund Wells - Charles Dikkens.

P: (pause - eagerly) Charles Dickens??

C: Yes.

P: (excitedly) You mean "Barnaby Rudge"!

C: No, "Rarnaby Budge" by Charles Dikkens. That's Dikkens with two Ks, the well-known Dutch author.

P: (slight pause) No, well we don't have "Rarnaby Budge" by Charles Dikkens with two Ks, the well-known Dutch author, and perhaps to save time I should add that we don't have "Karnaby Fudge" by Darles Chickens, or "Farmer of Sludge" by Marles Pickens, or even "Stickwick Stapers" by Farles Wickens with four M's and a silent Q!!!!! Why don't you try W. H. Smith's?

C: Ah did, They sent me here.

I had always believed that plural never uses an apostrophe before the 's' (it's only used for possession), but I have rarely seen in written material the format "four Ms". (On a side note, whoever wrote this transcript also used "two Ks".)

On a side note, and perhaps this should be a separate question, if a Compact Disc is a CD, then two Compact Discs would be two CDs right? (I see "CD's" written everywhere)

The Chicago Manual of Style, one of the more widely used style guides in the United States, says:

Capital letters used as words, numerals used as nouns, and abbreviations usually form the plural by adding s. To aid comprehension, lowercase letters form the plural with an apostrophe and an s.

So: Dikkens with two Ks, but mind your p's and q's. (And always CDs, unless you're talking about something the CD owns.)

Harbrace College Handbook 6th edition section 15d

Use the apostrophe and s to form the plural of letters, figures, symbols, and words referred to as words. Examples Congreve seldom crossed his t's, his 7's looked like 9's, and his and's were usually &'s. Note: This apostrophe is sometimes omitted when there is no danger of ambiguity: the 1930's, or the 1930s; two B's and three C's, or two Bs and three Cs.

This is one of those annoying exceptions to the general rule of never using an apostrophe to form plurals. It can be used when treating letters and numerals as nouns.

Personally, I only use it with lowercase letters where it is distinctly helpful (mind your p's and q's); for uppercase and numerals, adding a lowercase 's' should be clear enough.

To form plural of letters, figures, symbols and abbreviations put the concerned thing in single inverted comma and then add s.