Yes the pm's with N beside them ARE the 'not read' items. Open these and the icon will stop flashing. You do not have to delete them to stop them flashing so you can keep your messages. What I am not sure about is when your postbox is full. Is it when there are a number of unread messages or is it when you have a number of read messages. I have until recently allowed mine to build up until there are quite a few but delete them all now.