Is it more appropriate for women to wear capris or dresses in Italy?

Both are fine. Just remember that knees and shoulders need to be covered if you are visiting churches.

Andrea is right. Remember that the rules apply equally to men and women in churches.

I always carry a scarf in Italy. Very useful for covering shoulders or wearing as a temporary skirt!

Those of us who wear an around-the-waist money belt choose pants or skirts versus dresses, just in case of needing to access it in a semi-public place (such as hotel reception).

We are currently in Siena, having spent the prior week in Rome.
We have planned this trip since July, finding the perfect hotel and right tour guides was the easy part, reading and obsessing over what to wear was nerve racking!

I read they do not wear jeans much in Italy... Yes they do! Seemed like all of the Italians with exception of the grandmothers are sporting jeans. Even in the upscale shopping district. I read not to wear jeans withs holes,( I don't have any anyways) but in the shops, including the high fashion area they were selling those types of jeans along with short shorts!
They wear a lot of Nike tennis shoes also or flats with sparkles.
I brought one pair of jeans and the rest dresses and skirts. I could have worn the jeans all the time, even to dinners and not felt out of place. We have gone to some family restaurants and upscale modern italian places and have seen jeans and tshirts, or jeans with button up shirt untucked in all the places.
Funny thing about the churches, and we must have gone in 50, even though there is a sign on the door that shows a picture of everything they expect..(no rank tops,no camera and or flash,no shorts) they never seemed to enforce it. Most woman covered their shoulders but there was always a pair of shorts or tanks running around. Not to mention cameras. I know St.Peters is strict..but no one seemed to care at the other churches.
So I guess bottom line, your on vacay ..be comfortable, have manners and gave a great time.

I did see guards enforcing rules at Santa Maria Maggiore, asking young women with bare shoulders to cover up and young men in shorts to wear the paper leg things they have available.

As to capris...I am in my 60's. Went to Italy last May and wore capris in Rome as it was hot for my North Idaho self. I did get some looks from Italian ladies my age, but not sure if it was the capris or the gray hair (most of them seemed to dye their hair). The looks didn't bother me, I just thought it odd that anyone would even notice. I was comfortable in capris and really it was so hot they were comfortable. I am not a dress or skirt wearer.

I think you should wear what makes you comfortable. If you enjoy wearing skirts or dresses, do so. If you are more comfortable in capris take a pair along.

I packed one dress. I ended up wearing it on the plane ride home, because it was the only clean thing I had left! Otherwise it was just a waste of luggage space.

For Italy in October I relied on a light skirt -- covered my knees but much cooler than long pants (and more air-cooled than capris) But that's my comfort level. When it got colder I switched back to long pants.

I always wear capri pants and short-sleeve shirts in Italy (we're usually there in August or September though when it's hot) and I have to wear tennis shoes & feel that they don't look good with dresses so capri pants it is for me! My husband always wears jeans or dockers style pants & has never felt out of place. Wear whatever you're most comfortable with.

I don't even own a dress, lol. I wore shorts mostly, and jeans in evenings or when needed.