Hey Mike,
I don't think there is a way to make the sort case insensitive. On a windows platform, I would just write a simple app in VB to do this type of sort, compile it into a COM object, and call it with <cfobject>. If you're not on Windows or don't like the COM approach, the only other way I could suggest would be to loop through the query and swap rows using querySetCell() until it was sorted the way you want.
Neither approach is real elegant but they should at least accomplish what you need.
Good luck,
GJ