Sorting based on next and previous records in SQL

I am trying to order a specific query by taking the next and previous records into account, but I can't seem to get it done. I would like to order by a number and a letter, but if, for example, the last letter of number 1 is equal to one of the letters of number 2, I want to change the ordering, so that the letter matches with the following record.

Create script and sql fiddle

http://ift.tt/1EwUd5s

create table Parent (
id [bigint] IDENTITY(1,1), 
number bigint NOT NULL,
PRIMARY KEY (id)
)
GO

create table Child (
id [bigint] IDENTITY(1,1), 
parentId BIGINT, 
letter VARCHAR(1) NOT NULL,
PRIMARY KEY (id),
UNIQUE (parentId, Letter),
FOREIGN KEY (parentId) REFERENCES Parent(id)
)
GO

INSERT Parent (number) VALUES (1)
INSERT Parent (number) VALUES (2)
INSERT Parent (number) VALUES (3)

INSERT Child (parentId, letter) VALUES (1, 'A')
INSERT Child (parentId, letter) VALUES (1, 'C')
INSERT Child (parentId, letter) VALUES (2, 'B')
INSERT Child (parentId, letter) VALUES (2, 'C')
INSERT Child (parentId, letter) VALUES (3, 'B')
INSERT Child (parentId, letter) VALUES (3, 'D')

Current query

Currently I am sorting with this query:

SELECT P.number, C.letter 
FROM Child C
JOIN Parent P ON C.parentId = P.id
ORDER BY P.number, C.letter

Current result set

number               letter
-------------------- ------
1                    A
1                    C
2                    B
2                    C
3                    B
3                    D

Expected result set

To clearify what I actually want to do, here is the expected result set (with C and B of number 2 switched).

number               letter
-------------------- ------
1                    A
1                    C
2                    C --switched
2                    B --switched
3                    B
3                    D

Other requirements and question

• It has to work in SQL SERVER 2005.
• There is a scenario where 3 letters per number are used, I am happy if it just uses the best match.
• I am actually also interested in solutions for later versions of SQL Server (for learning), but those do not answer my question.

Can anyone point me in the right direction on how to do this?