Original question:
"when we did use the two forms, how did one use them? My guess is that ‘thou’ was used for close friends and family, and ‘thee’ was used for everyone else … "
My first resource is always MY close friend, my dictionary. In this case, The American Heritage Dictionary.
THOU:
Used to indicate the one that is spoken to esp. in a literary or ecclesiastical context. [ME < OE]
USAGE:
Beginning in Middle English, you, originally a plural form, came to be used as a mark of polite address to a single person. More and more, the use of thou was limited to adressing a perosn with whom the speaker was familiar or intimate: children, social inferiors, God. This distinction persisted into the 16th century, and was used in early Modern English translations of the Bible. Eventually, you became the normal singular form, and thou was retained only in a few dialiects, in some literary styles, and in the religious use.
THEE:
The objective case of thou. 1. Used: a. As the direct object of a verb. b. As the indirect object of nominative as well as the objective case, esp. by members of the Society of Friends.
Interestingly, the online version
http://www.bartleby.com/61/roots/IE541.html
does not contain the usage note that is in the printed version. But it does have a reference to “tu-”, which is gibberish to me, but maybe you get it:
ETYMOLOGY:
Middle English, from Old English th, second person nominative sing. personal pron… See tu-.
and then:
tu-
Second person singular pronoun; you, thou.
- Lengthened form *t (accusative *te, *tege). THEE, THOU1, from Old English th (accusative thec, th), thou, from Germanic *th (accusative *theke).
- Suffixed extended form *t(w)ei-no-. THINE, THY, from Old English thn, thine, from Germanic *thnaz. ( Pokorny t 1097.)
As for your question re why we didn’t retain the two forms, all I can say is that unlike many languages, English evolves. And it appears to evolve rapidly, relatively speaking. Part of the reason may be that it was cobbled together from many languages, and spelling wasn’t even constant until the monks finally started codifying it and writing it down. They tried to apply the rules of Latin to it, which didn’t always work out well. Take the dangling participle. As Shaw said when his secretary tried to correct him yet again – something to the effect that her attempts to correct him were things “up with which I will not put.” In other words, sometimes “correct grammar” sounds so awkward, that even usage evolves. “It’s me,” is accepted, while the correct form, “It is I,” is almost never used. Go figure.