Are you sure it is "out of order"?  Picking sheets are intended to print by warehouse, SO lines on separate pages per warehouse.

Yes, we are using warehouses just to determine where in the physical building items are kept.  We have a retail room and then our main/regular warehouse.  We had removed grouping by warehouse and everything seemed fine for all previous orders until one order had 6 lines with 000 warehouse and one line (line 6) with 001.  On pick ticket it put line 6 on line 4 on pick ticket.

What do you mean "removed grouping by warehouse"?  So group 1 in the report is now the SO#?

We suppressed the Group Header#1, found a solution by adding a UDF for the SO_LINENO and recording the sort.

Suppressing report sections doesn't change how Crystal Reports sorts the output. 

Click Report - Report Sort Expert for details.