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Something going wonky in the Kobo database is a comon problem, though hardly something you see at *every* update. If you wanted to be completely sure you're in good shape, I would say, no harm in removing the database, (you can simply "Log Out", for the same result.) I can't see any reason to do a factory restore of the system partition. That can only increase wear an tear on the flash memory, which may well be the first thing to fail on the device over time.
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