Yes, words referring to God, including all three persons of the Trinity in Christianity, were normally capitalized in traditional style.
The practice is often still followed with nouns (Creator, Redeemer, Sustainer), but less often for less important words such as pronouns, just as 16th-century English grammar (e.g., saith, sayest, doth, hast, thee, thine) has become less common in modern prayers, liturgy, and Bible translations. Many denominations (especially mainline?) do largely use modern style, but many others (especially evangelical?) and many individual speakers still prefer the old-fashioned usage. (And because the grammar is no longer familiar to many people, some people just mix it up willy-nilly, even addressing God as 'you' and 'thy' in the same prayer.)
I agree that it's not remotely practical for LEO to have a second, capitalized entry for every word that could possibly refer to God. (He, His, Him, You, Your, Yours, Thee, Thou, Thy, Thine, Father, Mother, Son, Child, Holy One, King, Ruler, Lord, Savior, Maker, Creator, Spirit, Almighty, Omnipotent, Logos, Word, Comforter, Rock, Shepherd ...) Even in hymn texts, it's hard to know where to draw the line: 'Our Shield and Defender, the Ancient of Days' (conceived as direct address)? Or 'Our shield and defender, the Ancient of Days' (conceived as metaphor and traditional title)? It's partly just a matter of taste.
In any case, the capitalization issue is really a global style and usage question, not a translation question for a particular word.
So I don't support the suggestion.