Some of the columns that contain pre-defined strings (like types, system description, constants) are always fixed to a specific collation – Latin1_General_CI_AS_KS_WS. This is irrespective of instance/database collation. The reason is that this is system metadata and basically these strings are treated case-insensitive (like keywords so always Latin).

Other columns in system tables that contain user metadata like object names, column names, index names, login names take the instance or database collation. The columns are collated to proper collation at the time of installation of SQL Server in case of instance collation & at the time of creation of database in case of database collation.

This has always been like this (at least use of the Windows collation for these columns). So not sure what is failing & why? I suspect the problem the user was having was collation conflict between columns. Repro script will help.