Hi Fisher,
I cannot say whether we will have eclipse 3.1 in the next release, but I do know it is being evaluated currently.. we'll see!
Back to your problem: I have never experienced anything like this, that bad, myself... the largest software projects I have worked with have had 30-50 user files and code in the range of 20,000-30,000 lines(user code, not including the system library).
However, I have not tried all the eclipse bells and whistles which index everything... you allude to trying to restore default eclipse settings. This is a good idea. There is an easy way to do this, though: just back-up your existing eclipse workspace (by default this is in nios2/bin/eclipse/workspace) and rename the directory or delete it. Then, re-start eclipse..it should be as if you had installed for the first time and all of your settings were removed. You will need to re-import your Nios projects, but after this you should be able to see if the problem occurs again.