Everything is kept, you overwrite only koreader files (i.e. code), not your user data.
Depending of koreader version, there were some changes for OTA, so it may also be reason why it doesn't work. Just manually download last nightly and put it on your device, everything will be fine.
Only file that is overwritten is defaults.lua, if you edited this file, rename it to defaults.persistent.lua to not overwrite it and that koreader use it instead defaults.lua.
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