I see your problem now, you are referring to neSigOpt oin the order by and that refers to the field in the source table NOT your IIF() result. You need to change the neSigOpt ref in orderby to the position nmber of the field as in;

SELECT LName, FName, Mi, ThID, iif(empty(neSigOpt),1,neSigOpt), lPin, lFingerReg, ;
  PADR(ConfirmType(neSigOpt, lPin, lFingerReg), 30) AS ConfData, isactive, lOverride ;
FROM Ther ;
&lcFilter ;
INTO CURSOR SigTypeR;
 ORDER BY isActive, 4 DESC, 8, LName, FName, Mi, ThID