You'll probably also want to make sure the FW is up to date first, if you actually did a full factory reset.
And to use the latest stable, as there's a chance some March nightlies may be buggy on your device.
If you can check if you have a first or second generation H2O2, that might be helpful (and/or post KOReader's crash.log, current versions should have that info).
(And, FWIW, the still processing message is perfectly normal on the first reboot after a fresh install).
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