vBulletin 3.5 Issue

Are they remaining all marked as unread immediately after using "Quick Links" > "Mark Forums Read" within that session, or are you saying that after that, exiting and coming back again (perhaps after a browser restart) they return to unread again?

Now, I don't want to get your hopes up by asking this question because frankly there is nothing I can adjust on this end to fix the problem for you when it works for the majority of people. At best, it could be a vBulletin bug that only effects some people, which in time they'll find and resolve, or at worst, it's a problem on your end that we can't help you with. But I can't do anything about it because we're talking some pretty core vBulletin code here. The unread thread subsystem is very complex and not something I'm going to be messing around with.

Although this problem is different, the usual recommendations always apply as a starting point. Clear cache, restart browser, and make sure no web filtering, proxy, cache servers, or software firewall applications are getting in the way of your session here. Make sure session and permanent cookies are fully allowed, as many of these variables are passed via cookies. A little more on this is here.

"New Posts" is actually just a predefined Search function. vBulletin does not re-execute a search if the searching parameters have not changed since the last time you made that search, and it's within a certain time frame. When you click New Posts, make a quick post somewhere, and then click New Posts again, vBulletin starts back within its cached search results, and simply passes a slightly filtered version of those back to you again. It isn't able to add results, as the collection set is established when you first did the search, but it can drop items out if certain other parameters change. (A search results cache is really just a list of either thread or post IDs, and that list of IDs does not change when the same search is re-executed within an hour, and within the same session. But, the displaying of the results is a processing loop that can drop some items out based upon IF conditions available when those IDs are mapped back to the original posts or threads themselves for displaying the search results page back to you.)