From my understanding in most parts of the world literacy was something only nobles and a few special educated exceptions possessed until just recently. I can imagine not being able to read or write would make people less proficient at their languages. Is there any information on this? Is there any evidence for this? How was language use different for people who were illiterate.
There's a problem with the question you're asking.
I can imagine not being able to read or write would make people less proficient at their languages
This would be false. Literacy has no bearing on whether one is or is not proficient at their native language. What it does have a potential impact is their ability to function in the literary register, but if there is no literacy then there is no literary register.
Day to day language use does not differ significantly between literate and non-literate cultures. Many languages around the world still do not have any writing system and it is not an impediment in any way to their normal use of their language.