MS Access 2010: "collating sequence not supported with the specified file format"

I had the same problem and found a different solution. I am using ms-access 2010 and 2007. 2010 could not create mdb files and the accdb files it created would not open in 2007. The solution was to go to the File tab in 2010, click the options link and set the sort order for new databases to 'General - legacy'. The sort order that was displayed was 'General' I then created a blank database in mdb format and imported all the objects, forms, code et. The newly rebirthed database works in 2007.

This KB article by M$ fixed my problem. The issue was the "new database sort order" setting.