i like the idea of erasing the first wolf parade album because it's an album that i absorbed in chunks over the space of 5 years. if i could erase my memory of it and listen to it now from start to finish it'd be quite an experience.
you could also erase albums that you like but have bad real world associations with, like if they remind you of a troubled time. i have a fair few albums which are great albums, but unlistenable due to this problem.
it's a nice idea, but it would alleviate the pressure on bands to be competitive and good. because in this world, hype is no longer a short term concept - it's an ongoing situation that might prove awful. imagine if the klaxons remained the hottest band indefinitely. or a world where people are constantly saying OMG YOU JUST HAVE TO LISTEN TO THIS NEUTRAL MILK HOTEL ALBUM. but i suppose you could counter this tedium by just erasing the albums you're sick of hearing about.
there's also something to be said for the comforting familiarity of a favorite album, not to mention the historical context that underpins certain albums, adding an extra dimension to their value.