Learning to Play with a Capo

I think before you try to understand how a capo changes keys you have to 
understand the chromatic scale.

There are 7 notes on the guitar: A B C D E F G everything then repeats itself 
again: A B C D E F G A B C D E F G A and so on. Get the jest so far. 

Now between these notes we have sharps(#) and flats(b), with the EXCEPTION 
of *BC* and *EF*. IT IS VERY IMPORTANT TO REMEMBER THIS.

So chromatically we now have:
A(A# or Bb)BC(C# or Db)D(D# or Eb)EF(F# or Gb)G (G# or Ab) THEN A again. 
Here is another IMPORTANT point I should mention. A# is the same note 
as Bb; C# to Db, etc.  I guess you call a note by flat or sharp depending on 
which direction you are playing on the board.

Now getting back to the 7 notes A BC D EF G  all notes with the EXCEPTION OF BC 
and EF are spaced apart by 2 frets *WHOLE STEP*. BC and EF are 1 fret or 
a *HALF STEP*.

Now for some examples: if you know a song in the key of C and someone plays 
it in D the distance from C to D in your scale is a WHOLE STEP or 2 frets, that is 
why you put the capo at the 2nd fret to play in the key of D while actually playing 
C shape. Remember when you switch to your F chord you are now playing a G and 
when you change to your G you are now going to be playing A. Starting to get the 
jest of it. Am also goes with the key of C so when you play it with the capo on the 
2nd fret you have your Bm for your key of D.

If you have a song in the key of F and want to play it with the capo on the 1st fret 
and play E because the distance between E and F on your scale is 1 fret. The same 
goes for B and C.

Say you have a song in the key of E(E A B7) and you can't play a B7 because you 
muffle the strings. Put the capo on the 2nd fret because the distance between D 
and E is a whole step or 2 frets and D(for your E), G(for your A), and A7(for your B7).

One more for the road. I found a song that has a C#m chord in the key of E and 
you say I can