I did my planned wipe & reload yesterday. And thanks to this thread removing the 'New' badges was quite easy.
I modified grimborg's instructions slightly. I have a script manager installed on my PRS-T1 so I can run simple shellscripts easily when needed. Because I was adding the books back in batches I decided to script the sqlite3 stuff.
sqlite3 /mnt/sdcard/Sony_Reader/database/books.db "update books set reading_time=1 where reading_time is null;"
#sqlite3 /mnt/extsd/Sony_Reader/database/books.db "update books set reading_time=1 where reading_time is null;"
I currently have books only in the internal memory (so mounted to /mnt/sdcard) but I decided to put the extsd line in there as well (but commented out) just in case I need it in the future.
I currently have that saved on the READER partition as allread.sh (short for 'mark all as read') and have a it marked as a favourite in my scriptmanager. When I've added something new I just open the scriptmanager, click the script, and then click 'run'. Once I do that all the 'new' markers are gone.
So that's my latest tweak to this. Finally a big thank you to pssquirrel for bringing this up, and to grimborg for sharing the sqlite3 commands. All in all this thread has made reloading my reader a lot easier than it might otherwise have been.