Processing books can take a while if you have many on the card. I hope it correctly processes all your books and that you don't encounter the sleep and home button issues afterwards.
If you do, there is a bug fix firmware (2.3.2) available
here, however
- manually upgrading firmware is not officially supported by Kobo
- you'll have to be sure which firmware version you need. "Touch" version for all 'old' model Touches; "Glo/Mini" version for all 'new' model Touches...
- I'm not sure if the firmware bugs you are describing are fixed in 2.3.2
- you could also downgrade back to 2.1.5, as many people have done and are happy with