Su primera consulta es la más cercana, excepto que no incluyó todos los case en función de agregado. También parece que no necesita algunas columnas en group by cláusula:
select
[Encounter Number],
Proc1 = max(CASE When [Encounter Proc Sequence] = '1' Then [Procedure Code (Enctr)] END),
SvcDate1 = max(Case When [Encounter Proc Sequence] = '1' Then [Date of Service] END),
Surgeon1 = max(CASE When [Encounter Proc Sequence] = '1' Then [Surgeon] END),
Proc2 = max(CASE When [Encounter Proc Sequence] = '2' Then [Procedure Code (Enctr)] END),
SvcDate2 = max(Case When [Encounter Proc Sequence] = '2' Then [Date of Service] END),
Surgeon2 = max(CASE When [Encounter Proc Sequence] = '2' Then [Surgeon] END),
Proc3 = max(CASE When [Encounter Proc Sequence] = '3' Then [Procedure Code (Enctr)] END),
SvcDate3 = max(Case When [Encounter Proc Sequence] = '3' Then [Date of Service] END),
Surgeon3 = max(CASE When [Encounter Proc Sequence] = '3' Then [Surgeon] END)
--- etc.
from EncounterProc
where [Date of Service] between '20090101' and '20091231'
and [Procedure Code (ENCTR)] is not null
group by [Encounter Number], [Encounter Proc Sequence]
