A. The SQL Server collation is set at installation time. It enforces the rules around the storage of data, including how it's sorted and compared. By default, SQL Server 2008 uses a collation of SQL_Latin1_General_CP1_CI_AS, and this is fine if you're only intending to use a single language, so you can ignore the warning.
However, if you need to support multiple languages, you need to change the SQL collation during installation to Latin1_General_100. You can set this on the Server Configuration page of the SQL installation. Select the Collation tab, select Customize, and set the desired Collation for Database Engine and Analysis Services.
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