For the technically inclined, you can edit the raw data in the SQLite database used by the Kobo eReader. Not as hard as it sounds. I downloaded SQLite2009 Pro (free) and opened the database file KoboReader.sqlite. You can edit the values in the content table to clear items from the 'I'm Reading' list.
This is not supported and probably not recommended by Kobo.
Take a backup of your database file before touching it.