I don't want to get into an argument about this issue... and I'll start off by saying this: if the script is phenomenal, grabs the reader's attention and holds it for ninety pages... then formatting won't matter
However, most of the formatting issues in scripts are there for a reason... So, here goes:
1) Capitalise character's name first time they appear in the script
This is a good idea, because, although you may have all the characters straight in your head, it's easy for readers to get confused by who is who... putting a character's entrance in CAPS helps the reader keep that stuff straight, which in turn makes it an easier read.
I can't tell you how many scripts I've read where I'd lost track of the characters by page six.
The only reason for sticking to this rule is because it's industry standard and showing you know the difference between a spec script and a shooting script helps readers have confidence in you as a writer. In real terms there is no good reason for not numbering scenes (except for the fact that people will sneer if you do). In fact, my first producer asked for scene numbers on spec scripts so it was easier for him to give notes.
3) Avoid parenthetical direction
Only matters if you're using it to tell the actors how to deliver lines...
JOHN (angrily)
Stick your bloody formatting!
If you have to put (angrily) into your script, then you've blown the writing... it should be obvious from the context how the line is delivered. So, in general, emotional direction in parenthetical indicates poor quality writing. It's one of those short cuts that people take when they don't know how to write a scene properly.
4) Avoid references to camera and camera angles
and
5) Avoid "we see" and "we hear"
These REALLY, REALLY matters... because people write camera angles and use phrases like "we see" when they are writing the script from the POV of a passive audience member. Scripts loaded with "we see" and "we hear" and camera angles, also tend to be loaded with passive verbs...
John is sitting at the table. We see Jane entering the door. The Barman is polishing the glasses.
The problem with scripts written from a passive POV, is they become very, very tedious to read.
Scripts read better if the reader is immersed in the world of the film, rather than passively watching the end result. For that reason alone, both camera angles and "we sees" are both signs of poor writing technique.
This rule isn't about an industry standard... it is about the difference between good writing and bad. There are also exceptions... you're more likely to get a "we hear" or a "we see" in the first paragraph of a script because you're taking the reader into that world... but a script that is all written passively, is a script that probably sucks.
6) Do not capitalize sound effects or sound references
Some readers really hate this... some really like it. I hate it; my script mentor likes it. It's never going to be a deal killer and only becomes an issue if the script isn't strong enough.
7) Do not use "MORE" and "CONTINUED" for scenes that break from one page to the next

Do not use "MORE" and "CONT'D" for dialogue broken by action
Again, unlikely to be a deal killer. I've heard people argue it ruins the flow of the read... but again, if you've got people hooked ... etc, etc
An experienced working writer probably isn't going to the readers who will be reading your script. So they're not going to mistake you for one regardless.
While formatting and style matter somewhat, you have to write coherently and tell a good story with interesting characters. No one expects you to have experience or be a working writer. They want a script that will make a good movie. Do that and the rest is academic.
Bebblebrox is right... you have to have great characters, and a great story. If your story is all of those things people will let things slide.
However, with 98% of the scripts written and submitted to the industry being practically unreadable formatting is one of the ways you reassure the reader that they are in a safe pair of hands. I know from my own experiences that I'll pick up a script and merely by glancing at the layout of the first page, I can tell if the script is going to be worth reading. I know how that sounds... but the truth is, badly formatted scripts are always bad scripts. I've yet to read an exception.
Now, I believe it's possible that I might miss a great script, simply because I was prejudiced against it by the way it was laid out... but, if I know that I'm not the only one who makes those kinds of decisions... and most agents and producers have much less time to waste on a script than I do.
I don't know of anyone in the industry whose heart doesn't sink when they're handed a script in 18pt times new roman, with no proper slug lines and all the dialogue in caps.
I've never been a patient reader... and I'll put a script down the second I start losing the will to live (usually by about page three).
There is one more reason for not only formatting your script correctly, but also for using some kind of recognisable structure. Producers and agents don't read scripts, they send them out to readers to get script reports. Script readers are ALL frustrated screen writers whose starting point is that they know more than you... so, in general you've got a very, very tough audience. These guys will grade your script, often from checklists... if you haven't gone to the trouble of learning how to format a script, they are going to assume you also can't tell the difference between an inciting incident and a denouement... for which they will crucify you.