I was able to successfully root my wife's NC 1.2 using CWM 22.214.171.124 and Manualnooter 4.6.16. I had the Amazon market, Androit market, Netflix, etc...all working wonderfully until B&N auto updated me to 1.3 overnight. After the auto update, email, google apps, Anrdoid market, etc....all stopped working. I thought it best to revert back to factory and start from scratch. One problem, after the 8th interupted boot, instead of going into automatic reflash mode of the factory OS, I get sent to the CWM screen (black background with orange text) and I only get the option for resetting user settings and not factory settings. I reset the user settings and that got me to the re-registration page for the nook and it appears to the untrained eye that it is back to normal. But I can still find traces of the root here and there. Can someone help me completely reset to the Factory 1.2 OS and then redo the re-registration process; I'll side load 1.3 or auto update to 1.3 afterwards and then root from there...maybe.
Go here...very easy to do: http://mrm3.net/nook-color-recover-any-bricked-device/