Ach. Yeah that. Nearly as I can tell, they appear in the (chronological) order in which they were created or added to the Reader.
The only way I've found to re-order them is to move them all to the PC side of the Library software, remove them from the Reader, and re-add them in the order you want them to appear. You'll have to decide if it's worth the trouble to you.
I've settled on only keeping very few collections on my Reader (3 at the moment) and only adding books to it that I intend to read soon, as I would a reading shelf. I remove them as I finish them so there're rarely more than a score or so on it at any given time. It's what I call an "Ideal Situation" -- that's the situation and I deal. It works well enough for what I need to do.
