intermingling upper and lower case letters in group/sort

Currently (thanks to considerable help from Don and Oliver!), I have some
XSL that sorts my index entries, adding headings for each new letter.
However, I've discovered that I'm going to have some entries beginning with
upper case, and others with lower.  This, I've discovered, yeilds results
like:

   <H2>a</H2>
      aa
      ad
      az

   <H2>A</H2>
      Aaa
      Ae

When what I want is:

   <H2>A</H2>
      aa
      Aaa
      ad
      Ae
      az

I tried adding things like translate ($initial, 'abcde...','ABCDE...') at
various points, and got various results:  all lower case entries just
disappearing altogether, upper case entries being duplicated, etc.  Not
exactly what I'd hoped for.  Can someone (in novice terms, please) clarify
for me. 

  <xsl:for-each select="//index[count(. | key('letters',
substring(@entry,1,1))[1]) = 1]">
    <xsl:sort select="@entry" />
    <xsl:variable name="initial" select="substring(@entry,1,1)" />
    <xsl:choose>
      <xsl:when test="translate($initial,'1234567890@#','')=''">
                   <<!-- piece here not relevant to current issue -->
      </xsl:when>
      <xsl:otherwise>
        <h2><xsl:value-of select="$initial" /></h2>
        <xsl:for-each select="key('letters', $initial)">
          <xsl:sort select="@entry" />
          <p><a><xsl:attribute name="href"
saxon:disable-output-escaping="yes"><xsl:value-of
select="../@location"/></xsl:attribute><xsl:value-of
select="@entry"/></a></p>
        </xsl:for-each>
      </xsl:otherwise>
    </xsl:choose>
  </xsl:for-each>

Thanks again.  Eric


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