This doesn't feel like the right solution. We just do the Right Thing, rather than introduce extra options. If doing case-sensitive ordering is felt to be the right thing, then let's just do that always. I don't really see the need to be able to flip back and forth. Also, the fact that it removes "binary" as a potential field name counts against this patch (the fact that it's reserved in MySQL has nothing to do with it; we quote field names for that very reason). We should try to avoid doing stuff like that since it's difficult to tell who it will affect.
All told, I'm -1 on this approach to the problem (introducing a new option). Instead something that only added the "binary" extra bit for ordering when using MySQL as the engine (via a connection.ops feature, not via a test for MySQL in the Query class) would stand a better chance. You probably want to start a discussion on django-dev first, however, to see what the consensus might be as far as the natural ordering to use. Let's move discussion to the mailing list for now.
(Fixed wiki formatting problems in the description. The "preview" button is your friend.)