What nouns of German origin should be given capital letters?

(1) General concept of nativization

Languages have a strong tendency to gradually nativize or naturalize loan words. That means that at first,
(i) loan words retain aspects of foreign pronunciations or spelling,
(ii) are irregular in that they take inflections from their native language,
(iii) and are used in a specific, unproductive context.

But over time, they
(i) change their pronunciation and spelling to fit the phonology and orthography of the target language,
(ii) start to be used with native inflections,
(iii) and appear more productively in a wider range of contexts.

The determinants of this process are:

• time - as time goes by, the chances increase that the word will be used like any other native word
  
• continued currency - a word must retain a certain level of use to naturalize; if it becomes too infrequent, it feels exotic, special, salient, or drops out of use altogether
  
• structure of the lexicon - if there are many similar words in the language, it becomes much easier to interpret the word as native
  

To give one of countless examples, consider the word baggage. Originally borrowed from French in the 15th century,
(i) the word would have been pronounced something like [bagaʒ] but has since been accommodated to native English phonology by adding stress, fronting the vowel [a]>[æ] and strenghtening the final consonant [ʒ]>[dʒ],
(ii) it would have had a French plural (something like bagages), but is now used as a mass noun (much baggage rather than ?many baggages),
(iii) and it has widened its sense from the sense 'collection of portable property' to, for example, 'psychological burden' (she carries a lot of baggage from her childhood), among others.

The word has assimmilated well into the English lexicon because:

• a lot of time has been available to naturalize the word
  
• the word has remained current throughout its history
  
• the English lexicon can easily accommodate the word based on the presence of many similar words (e.g. massage, advantage, passage etc.)
  

(2) Nativization of recent German borrowings

The gradual de-capitalization of the relatively recent German borrowings Zeitgeist and blitzkrieg is one very specific sub-case of the general process of nativization of foreign loan words. It's a gradual process. It is determined by the same factors as listed above.

The words blitzkrieg and Zeitgeist are only partially naturalized in English at the moment, and that includes their spelling (German capital letter > nativized English lower-case letter), because:

• the words were created in the 1940s and 1840s respectively, i.e. they are relatively young and more time is needed to fully assimmilate them into English
  
• while the words have retained some level of currency, they are not very common, but rather exotic, specialized, unusual words - Blitzkrieg in particular loosing a lot of relevance - which slows down their nativization
  
• there are not a lot of similar words in the English lexicon - initial z is rare and corresponding words are often not native either (zoology, zen); the graphemes tz does exist but it feels foreign as well (waltz, pretzel) - which is another factor that hinders easy assimmilation into the English lexicon

Some speakers allow for greater nativization of the words and already spell them with a naturalized, lower-case letter whereas other speakers still recognize the foreign source of the words and continue to use the original, upper-case spelling. This is the reason why there is spelling variation today. Over time, as the gradual nativization process continues, the nativized spelling with a lower case letter will likely become the standard spelling.

The following graphs from Google Ngram illustrate the nativization process of recent German loans.

(1) kindergarten - borrowed c. 1850, spelling with lower-case letter common from c. 1880.

(2) ersatz - borrowed c. 1875, spelling with lower-case letter common from. c. 1930.

(3) wunderkind - borrowed c. 1890, spelling with lower-case letter common from c. 1970 (also note the gradual plural regularization Wunderkinder > wunderkinds)

(4) schadenfreude - borrowed c. 1850, spelling with lower-case letter common c. 2010.

The word Zeitgeist was borrowed in the 1840, but as of yet, the spelling with a lower-case letter is not the preferred form. However, there has been a recent increase in that spelling indicating that the word is on its way to naturalization. Additionally, the original plural Zeitgeister has now almost completely been replaced by the English plural zeitgeists.

Finally, the word blitzkrieg is special. It has lost a lot of its relevance since the 1940s. Hence, there is no linear historical trajectory here. It is also often used as a proper noun (similar to the Blitz) so that standard English orthography would mandate a capital letter anyway. Hence, one would not expect a clean transition from upper to lower case letter. Finally, the word is very marked historically or sociologically. Thus, some speakers may want to highlight the special significance of the word by retaining a capital letter (similar to Nazi, Lebensraum etc.). The upper and lower case spellings are split more or less 50:50 in the textual record.