It depends. Using all caps sparingly for emphasis or in certain special cases might be okay, but using them frequently can be seen as shouting and might come across as unprofessional.
Well, 'caps psychology fanfic' could be about exploring the psychological aspects of characters in a story where 'caps' might refer to some sort of characters with capes perhaps, like superheroes. It could delve into their motives, fears, and how their minds work in different situations.
Sure. For example, in a short story about a baseball game. 'CAPS were everywhere in the stadium. The players' CAPS had their team logos on them. The fans were waving their CAPS in excitement as the game reached its climax.'