The theory of collisionless fluid ion temperature-gradient-driven turbulence is extended to the collisional banana-plateau regime. Neoclassical ion fluid evolution equations are developed and utilized to investigate linear and nonlinear dynamics of negative compressibility eta-i modes (eta-i = d ln T(i)/d ln n(i)). In the low-frequency limit (omega < mu-i, where omega is the mode frequency and mu-i is the neoclassical viscous damping frequency), neoclassical effects modify the sonic eta-i mode by introducing strong viscous damping of parallel flows, which renders the long wavelength response dissipative rather than inertial. Also, the linear and nonlinear polarization drifts are enhanced by a factor of B(t)2/B(p)2. As a result of these modifications, growth rates are dissipative, rather than sonic, and radial mode widths are broadened [i.e., gamma approximately k(parallel-to)2 c(s)2 (eta-i - 2/3)/mu-i, DELTA-x approximately rho-s(B(t)/B(p))(1 + eta-i)1/2, where k(parallel-to), c(s), and rho-s are the parallel wave number, sound velocity, and ion gyroradius, respectively]. In the limit of weak viscous damping, enhanced neoclassical polarization persists and broadens radial mode widths. Linear mixing length estimates and renormalized turbulence theory are used to determine the ion thermal diffusivity in both cases. In both cases, a strong favorable dependence of ion thermal diffusivity on B(p) (and hence plasma current) is exhibited. Furthermore, the ion thermal diffusivity for long wavelength modes exhibits favorable density scaling. The possible role of neoclassical ion temperature-gradient-driven modes in edge fluctuations and transport in L-phase discharges and the L to H transition is discussed.