[diba]

I think there are people interested in this. I assume, looking at the screenshot, single books will be protected with your method. Especially owners with children are frequently asking for such a possibility to avoid that children start reading not age appropriate books on a family-kindle. I know this for sure from the german "Amazon Kundendiskussion".
The "hide-folders" hack is another possibility for this and the developer is looking for a password protection as well.
Another step could be to protect collections from being openend with a pw. So even the titles would be hidden.

I am much better in having ideas than being able to get them operational ;-) .