Sometimes SQL Server collation and your database collation might be different. For example; Turkish hosting providers are using default
Regional Settings while installing
SQL Server 2005/20008. This is resulting master database collation to be set as
Turkish_CI_AS. So far, no problem. You may experience outstanding issues while installing DotNetNuke using Turkish_CI_AS collation.
At the very beginning after facing the collation problem i decided to use
Latin1_General_CI_AS as server collation and results were very helpful.
In a test development environment you could easily uninstall and reinstall SQL Server with correct settings. However in a production environment you might have other applications running at same server, because of that you may need to rebuild your master database collation.
SQL Server 2008 Books Online tells how to do this. However this information is not correct at all.
You can find actual instructions for changing master collation at following blog post:
How to Rebuild System Databases in SQL Server 2008