Ok, that explains how but not why you use it. I assume you want to keep the same key. Have you tried remapping caps lock in mac os to right control and then setting up shortcuts with that modifier? BTT can distinguish between left and right control key. So you can do everything you listed with a "fresh key" that you normally don't have on your keyboard. All shortcuts with the "normal" (left) control key remain unchanged.
I think the issue affecting arrow keys and function keys is the same. I'll have a look soon!
I was trying to replicate issues with the arrow keys and the hyper key, but so far in my tests it always worked.
Do you have a concrete example that causes issues for you?
Note: the BTT hyper key only works well for shortcuts defined in BTT, but I think that's what you did for the F keys already, right?
Here's an example:
I set up a play/pause audio shortcut (hyperkey F9) in BTT, and while it works if I manually hold down Sh Ctrl Opt Cmd F9, nothing happens when I hit Caps Lock F9. My two BTT Drafts hyperkey items work fine, but for some reason, not the play/pause. (see screenshot)
If I change the trigger to Ctrl F9 it works fine. But Ctrl Opt Sh Cmd F9 doesn't work.
I double-checked to be sure there are no Keyboard Maestro macros triggered with hyperkey-F9, and even tested after quitting the Keyboard Maestro engine. I also searched through my System Preferences keyboard shortcuts and there’s nothing assigned to F9, with or without modifiers.
It seems such a simple thing should work, so there must be something corrupt or conflicting in my setup.
I often use the small keyboard, which doesn’t have a right control key (to keep my sore right arm from reaching further to the right for the trackpad). Are you suggesting doing this as a test, or to permanently avoid the caps lock/hyperkey? I do have a large keyboard I use on occasion.
Thanks,
Russell
Hi Russell
Exactly, most keyboards don't have a right control key. But you can make your caps lock key in macos the right control key.
System Preferences▸Keyboard▸Modifier Keys.
Set „caps lock“ to „ctrl“
It does not show it, but now „caps lock“ is the physical „right control“ key. The „left control“ key remains what it was.
With BTT you have the option to set up shortcuts that only work with right control, or only with left control.
I don't want to upset anyone who is insisting on using hyperkey. I just don't see the point when I can use a "real" modifier and BTT gives me the option to distinguish between left and right. 
Get well soon for your arm 
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So your method bypasses the need to use the hyperkey completely! This seems like a brilliant solution to using either Karabiner or BTT. Are there any downsides of which you are aware? Looks like I'd have to move my Keyboard Maestro macros that use the hyperkey to BTT, since Keyboard Maestro doesn’t appear to differentiate fight and left control keys.
Why would anyone bother relying on other software when you can do this with just MacOS?
You still need BTT or some other app to define shortcuts that only work with right ctrl 
But I agree it's a great solution!
The point is: Apple does not distinguish between left and right modifiers. Keyboard Maestro, which you also use, does not either.
Only BTT does. It only works if the shortcuts are set up with BTT. That's the downside, if you want to look at it that way.
But then surely more reliable, because no complex mixture of modifiers has to be kept down, but a "real" modifier is used.
I just realized I’d still need BTT. BTW, I set up a fresh "test" account, set up the BTT caps lock hyperkey, and tried it with F9. Just like my main account, it worked when I held down Ctrl Sh Opt Cmd F9, but not with the caps lock. I'll see how Frank1's idea works for me.
I'm trying you idea, but when I record a shortcut in BTT, it displays ^F9 whether I'm holding the left or right ctrl key when I hit the F9 key. Is there somewhere in BTT I need to activate separate control keys?
No, not necessarily. Just trigger your KM macros with a right control shortcut in BTT.
I just saw the checkbox to differentiate L and R mod keys, and now I've got it where on my big keyboard R ctrl plays/pauses the music and L ctrl just gives a system beep.
But it doesn't work when I hold the caps lock, even though I set it to be Ctrl as your screenshot showed. But if the keyboard modifier settings are sending "^ Control" with both the caps lock and the control key, how does BTT know the difference? Or does the Mac send separate code depending on L or R, even though the keyboard settings don't appear to differentiate?
That's for Andreas to answer
I'm not sure I understand the rest. If you want to perform different actions with left and right control, you have to set up both shortcuts separately.
I guess it doesn't matter how BTT can tell the difference. But I'm at a spot where R ctrl F9 plays/pauses, but Caps Lock F9 does nothing, even though I've set it to perform Ctrl as your screenshot demonstrated.
It seems the Mac gods are stopping me at every turn. 
Did you disabled the hyperkey actions in BTT?
Tried it with the Caps Lock Act as hyperkey disabled and enabled. Didn't work either way.
I have to leave now, but I'll continue later. Thanks for all your kind help!
I think your problem might be, that play pause doesn't like to be combined with some modifier keys.
You can try this:
That fixed it. Do you know of any other BTT actions that don't well with certain modifier keys, or is play/pause an unusual case?
Thanks,
Russell
Got it working with the solution Andreas sent. Seems the play/pause action is unusual.