Are you talking 16 or 20 oz water bottles? If so, my understanding is the container needs to provide enough space for at least 3 inches deep of growing medium, as well as sufficient head room for the seedlings to grow a little. Also, the smaller the container the more quickly it will dry out.

You always throw away the screw-on cap. The hole will work to vent fresh air in to keep the bottles from overheating or molding, as well as allowing rain and snow in to water the container.

Exactly what bookjunky4life said....throw the plastic caps away and that is all the ventilation you will need! Good luck with your sowing!