Does indeed mean "Top Hat" ( Cappello, Hat; Cappellino, Small hat, Cappellozzo "Large Hat (Top hat)"
The term is carried over from the "Top Hat Musket cap" of the 1840s 1870s, which refelcted the "Top hats" of the day.
The "Cappellozzo" of the Cartuccia per Tiro Ridotto" is effectively a Reversed Top hat cap with an extra charge within it, besides the priming compound.
The Cartuccia per Tiro Ridotto ( Saloon cartridge or Zimmer patronen) was assembled on the Austrian "Conus" principle, using either a fabricated cases ( brass cartridge case with inner tube and bored chamber to hold the Propellant charge) or alternately a turned brass or steel "Faux-cartouche" to hold the charge and pellet.
I have seen one of these steel (Commercial) items, with a M1867 Werndl converted to 6,5 Italian, in possession of a Now deceased family friend, in Italy. He also had a tin of pellets and also cappellozzi, made by Fiocchi if I remember rightly (it was back in 1980)
The brass (Army issue) M91 Models were made using recovered brass cases and fitting them with a Bullet "Tube" and boring out the chamber in the head.
The "crimp ring" in the M939 model was to obviate loss of the tube by repeated use, and was designed (I think) for single use only, as it used a standard primer, and not a Capellozzo ( somebody correct me If I am mistaken
A special Pliers type "Reloading tool" was also supplied, with a decapping pin, a Cappellozzo seater, and a Pellet seater. Various of the better books on the M91 Carcano carry detailed pIctures of the accessories.
The Commercial versions also offered what appears to be a Paper shell Cappellozzo, with a somewhat stronger charge than the standard Military brass item.
The Whole Idea was for Indoor traing use, in barracks. Most Traditrional Italian Army barracks had a "Sala da Tiro" (often the Fencing Hall) for the use of such "short range" gallery Practice ( 10-15 metres maximum.)
Backstops consisted of some Hay bales or a pile of sacks or other absorbent materials.
In Winter, the Indoor facilities were much appreciated, especially in the North, where snow could and did fall quite heavily during the Winter Months.
As to Philippe's reference to the Ballilla Youth carbines, the Cappellozzo was used as a Blank for the smallest Model Ballilla carbine, those used by "entry level" youth ( 6-10 years of age).
The next group (11-14) used a Miniature 6,5mm Ball cartridge ( 6mm, and a cartridge cases effectively a .30 M1 carbine case dimensions necked down...with a Miniature 6 round clip to feed them. )The group also used standard 5,6mm/6mm Flobert (.22 RF) Target rifles.
The 15-18 age group were a mix of the .22 rifles and the full size M91 Cavalry carbine, whilst the 18-20 year old "Avanguardisti" were equipped as the Royal Army.
The 6mm Miniature cartridge and its clip are the rarest Italian Military cartridge and accessories. The carbines are relatively more common.
I have made for my own use, a similar system using other Military case designs ( .30/06, etc, using either a shotshell primer ( 245 magnum) or using a normal primed case, and swaging a thick brass tube inside it, and fitting an appropriate round ball to the (machined) concave end of the "Tube". Again, a variation of the "Conus" system originally developped by the Austrians as far back as the Wanzl trapdoor rimfire Musket (1867)
An interesting area of research.