Step 1: Recall that the acidic nature of phenols depends on the stability of the phenoxide ion formed after loss of H$^+$.
Step 2: Electron-withdrawing groups increase acidity by stabilising the phenoxide ion, while electron-donating groups decrease acidity.
Step 3: In o-nitrophenol, the –NO$_2$ group is a strong electron-withdrawing group, which greatly increases acidity.
Step 4: In o-cresol, the –CH$_3$ group is electron-donating, which decreases acidity compared to phenol.
Step 5: Therefore, the relative acidic strength is:
\[
\text{o-nitrophenol}>\text{phenol}>\text{o-cresol}
\]
Step 6: This relationship is correctly represented by option (B).