When is it OK to use OK?

Solution 1:

It's ok to use it in pretty much any email and (especially) phone conversation, even in business context. At least that's my experience from the software industry (communicating mostly with European and North American people). For formal letters and academic writing it would be a different story, of course.

But if you don't want to annoy people, please do not always write it in capital letters ("OK"), ok? :-) Maybe it's just me, but that seems somewhat archaic.

Solution 2:

I was taught in American schools that "OK" was the correct spelling, because it was an acronym for [various improbable figures of speech]. Suspiciously, it turned out that "okay" is a word from the same languages African slaves spoke, and it means "OK". Early Americans didn't like to acknowledge the African contribution to American culture, which is the likely reason for the acronymic construction. Assuming we accept that theory, "okay" is the more correct spelling.