In the movie The Wind Rises he is a "fictional" minor charcater who appears only in Jiro's dreams. Still he is based on the real Italian individuals of the same name (See Wikipedia on Giovanni Battista Caproni).
He is first mention in the magazine Aviation. Jiro borrow it from an older classamte. Since that day he dreams about Caproni.
He first appears in Jiro's dream when Jiro dreams of becoming a pilot. Caproni ends up taking Jiro up upon the wings of his first Italian plane and when Jiro asks if he can still design airplanes because he is nearsighted, Caproni answers that he has never flown a single plane, but that planes are like beautiful dreams.
After that, he appears in Jiro's dream when Jiro is returning from Germany asking Jiro if he would rather pyramids or without pyramids, meaning would he rather design planes even for war or not at all? Jiro answers Caproni by answering that even though his planes are used for war and destruction, he would still rather achieve his dream.
Finally, Caproni is last seen in a dream by Jiro and telling him that even though his planes have been used for destruction Jiro's dreams were none the less realized. Caproni also tells Jiro that Naoko has been waiting for him and that she was also a beautiful dream like his first successful airplane ending the film with inviting Jiro for a glass of wine.
In the movie you see six airplane designs of him: