[crote]

The funny part is that 'y' used to be quite common in Middle Dutch as a variant of 'ij' or 'i'. This resulted in words like 'anys' (now 'anijs'), 'Leyden' (now 'Leiden'), 'ghelyc' (now 'gelijk'), and 'waerheyt' (now 'waarheid'). It was simply an alternative spelling. This was officially abolished with a spelling reform in 1863, with it only being allowed in loan words.

> I also think it's fine to just capitalize the I: Ijsland instead of IJsland. I suspect this will be the norm 50 years from now.

Nope, this just looks wrong to me and the spelling rules do not allow it. It is written as a single letter, so it should be capitalized as a single letter.