Update - I plugged in my Kobo to see if the sideloaded books were still there and they were. Disconnecting the device (I was going to try rebooting it) triggered a "processing new content" message and all my sideloaded books were visible again. I'm very glad I chose to sign out - saved me a lot of work!
I'm just sharing this here in case others have the same issue.
Originally Posted by yhamm
I had the same issue and signed out. I can now add bookshelves but lost all my reading stats, recent reads, and bookmarks.
I'm sorry to hear that. I still have all my stats because my Kobo synced to the Kobo servers before the firmware update. Yours would have as well. Have you tried syncing your device again?
Originally Posted by taming
I was talking about the plugin people created to add features like shelves to the Touch. There is a very long sticky for it.
Hmm, I didn't have the plugin. Curiouser and curiouser!