To change the server default you need to rebuild the master db (gulp). If you feel brave enough then here are the steps (from BOL):
Changing the default collation for an instance of SQL Server can be a
complex operation and involves the following steps:
Make sure you have all the information or scripts needed to re-create your
user databases and all the objects in them.
Export all your data using a tool such as bulk copy.
Drop all the user databases.
Rebuild the master database specifying
the new collation in the SQLCOLLATION
property of the setup command. For
setup.exe /q /ACTION=RebuildDatabase /INSTANCENAME=MSSQLSERVER
Create all the databases and all the objects in them.
Import all your data.
Then followed by this, which may be less painful....
Instead of changing the default collation of an instance of SQL Server, you can specify a default collation for each new database you create.
Dec 17 '09 at 10:24 AM
Kev Riley ♦♦