I agree with Brent. Ever since the Ultra, Fortec has had a bug with respect to strange things happening whenever you exceed not only the maximum number of transponders, but the maximum number of other items too, like active transponders, channels, and some other things. Instead of fixing the problems, Fortec just added more memory, so that it takes longer before the symptoms appear.
With the ULTRA, however you could always determine if this was the problem, because it had has a channel editor that gives all this information, ie it shows how close you are to each limit, but the Mercury has only a marginally functional editor. I don't think it had this info, but I might be wrong.
But anyway, yes, after you get it working again, I would FIRST delete all unused satellites, before you start to program things again, then routinely delete all unused transpondersand unused channels to keep the receiver below the limits. However, and this is a big however, if you are using diseqC-1.2 to move your dish, if you delete satellites, it is very likely to mess up a lot of your sat positions due to the BUG in the diseqC-1.2 function, so I would only delete satellites BEFORE you start programming in any diseqC-1.2 positions.
You might be able to get the receiver back to operation without doing a complete factory reset, by going back to an older working channel data file, then deleting unused stuff, but whenever things like this happened to me, I'd just do a factory reset and start over. I have a Fortec Lifetime, Fortec Ultra, and Fortec Mercury, and the Ultra had more bugs than the Lifetime, and the Mercury has more bugs than both the prior receivers put together. With that trend, I don't think I'd ever consider another Fortec receiver.