Design SQL Server 2008 new install ... which collation?
The default collation is based on the Windows system locale of your server. SQL_Latin1_General_CP1_CI_AS is usually the default collation for computers based in the North American locale. Collation can be changed if you have a reason for it, like: sorting order, case sensitivity, accent sensitivity, non-English characters, width. 

Collation for a DB can be set at the time of the creation of the DB, so you can have a server that has DBs with different collations. The Alter database command can be used to change the collation of all newly created objects in the DB. I have used the default SQL_Latin1_General_CP1_CI_AS all the time and have not had any issues, but then I do more DB administration that development.