I had folders already created in my Project list for various categories of projects. After some time, I had built up some MRU history. I went into Project->Organize All Workspaces and moved most of the MRU list to folders and deleted the rest. However, I still had the MRU history listed when I went back to the Project menu. I expected it to be empty because I had cleaned it up. So, I went to Options->File Options->History->Project Menu and set the History Size to zero. Still, I had the MRU listed in the Project menu. I exited SE and re-opened SE. Now the Project MRU was empty. Then I went back into Options->File Options->History->Project Menu and set it to eight so that I can still have some MRU again.
I think that the Organize All Workspaces should have cleaned up the Project MRU. That was my expectation, but it is not a big deal if this is by design. It's just a little clunky.