Now that stability and performance issues were addressed with the release of 2.x firmware, we now have a good foundation to start focusing on adding user features such as being able to delete transponders from the satellite list. Keep in mind that the satellite list and transponders was updated in our recent firmware updates so there should not be that many dead transponders on the list.
For now as catamount mentionned, you may use DSEdit on your computer in order to delete transponders. This is an easy process, especially if your receiver is connected to your network as the software is able to directly to update the channel list on the fly over your network without having to manually walk over to to your STB with the USB stick that has your file.
P.S. Now that you upgraded to firmware version 2.02, please post your feedback when you have the chance at
http://www.satelliteguys.us/xen/threads/azbox-minime-american-edition-v2-02-firmware.345454/