I have not found an easy way to do this but, as usual with the iPad, there is a (very ugly) workaround.
Entries appear in the order in which they were added, irrespective of the characters in the title - i.e. as you say, they are not in alphabetical order.
However, when you edit the title of an entry in your collection, it maintains its position in the order.
So, if I added two collections 'Z' and 'A' - in that order, they would appear in the drop down collections list with 'Z' and the top and 'A' at the bottom - and my 'Z' authored books would be in my 'Z' collection and my 'A' authored books in my 'A' collection. If I want to re-order the list then my (very very) ugly workaround is to edit the names of the collections - rename the 'A' collection as 'Z' and the 'Z' collection as 'A' (I have to go via an intermediate letter first of all because I can't have two collections with the same name).
So, because during the renaming process, the collections don't move their position, I now have the 'A' collection (albeit containing the 'Z' books) at the top and the 'Z' collection (with the 'A' books) at the bottom. Now all (!) I have to do is to move the 'A' collection books (currently in the new 'Z' folder) to the correct folder and the same for the 'Z' collection books.
It sounds a tortuous process but, in fact, since you're not going to be doing it that often, it's not really that bad. But, if you have a large number of collections to move around, I agree that it's impractical.....
Tim