The code I posted is not what I'm having an issue with. It's NOT the code I used (RUN).
I was simply to lazy to retype it all here, but here it is re-typed for your "Amusement".
5 s=54272:pokes+24,15:pokes,220:pokes+1,68:pokes+5,15:pokes+6,215
10 pokes+7,120:pokes+8,100:pokes+12,15:pokes+13,215
15 print"{clear}":v=53248:pokev+21,1
20 fors1=12288to12350:readq1:pokes1,q1:next
25 fors2=12352to12414:readq2:pokes2,q2:next
30 fors3=12416to12478:readq3:pokes3,q3:next
35 pokev+39,15:pokev+1,68
40 printtab(160)"{white}i am the dancing mouse!{light blue}"
45 p=192
50 forx=0to347step3
55 rx=int(x/256):lx=x-rx*256
60 pokev,lx:pokev+16,rx
70 ifp=192thengosub200
75 ifp=193thengosub300
80 poke2040,p:fort=1to60:next
85 p=p+1:ifp>194thenp=192
90 next
95 end
100 data30,0,120,63,0,252,127,129,254,127,129,254,127,189,254,127,255,254
101 data63,255,252,31,187,248,3,187,192,1,255,128,3,189,192,1,231,128,1,
102 data255,0,31,255,0,0,124,0,0,254,0,1,199,32,3,131,224,7,1,192,1,192,0
103 data3,192,0,30,0,120,63,0,252,127,129,254,127,129,254,127,189,254,127
104 data255,254,63,255,252,31,221,248,3,221,192,1,255,128,3,255,192,1,195
105 data128,1,231,3,31,255,255,0,124,0,0,254,0,1,199,0,7,1,128,7,0,204,1
106 data128,124,7,128,5630,0,120,63,0,252,127,129,254,127,129,254,127,189
107 data254,127,255,25463,255,252,31,221,248,3,221,192,1,255,134,3,189
108 data204,1,199,152,1,255,48,1,255,224,1,252,0,3,254,0
109 data7,14,0,204,14,0,248,56,0,112,112,0,0,60,0,-1
200 pokes+4,129:pokes+4,128:return
300 pokes+11,129:pokes+11,128:return
This code can be found on PAGE #167 in the "Commodore 64 Programers Reference Guide" (<- Page 69 at the previous link).
It toggles between upper and lowercase fine, but doesn't change the letter keys out for graphics characters when held down. And yes, the text in {brackets} is not meant to be typed. After all C64 doesn't have a "{" or "}" key
Thanks, not sure if I mentioned this, but it's already been professionally refurbished so I'm sure that was done, but I'll check anyways. There may be an issue with my current screen not displaying the colours.