A simple (naive) patch to add a new variable 'sidebar_newmail_only' which will toggle
  the sidebar's display behavior.  Either showing *all* mailboxes, or only those with
  unread messages in them.  (This is *instant*.  If you open a mailboxe and read each
  message then the current mailbox will be removed from the list.  Freaky!)

   I have this in ~/.mutt-sidebar:

 macro index E '<enter-command>toggle sidebar_newmail_only<enter>'
 macro pager E '<enter-command>toggle sidebar_newmail_only<enter>'

   Patch follows in three parts:

     1.  Define new setting.
     2.  Update the sidebar-drawing to skip mailboxes where the unread count < 1,
        unless the folder is the current one, or the folder is the spool folder.
     3.  The navigation uses a neat fall-through trick when the flag is set.

 Steve
 --
 <steve @ steve .org .uk>


Index: mutt-1.5.17+20080114/init.h
===================================================================
--- mutt-1.5.17+20080114.orig/init.h	2008-03-13 12:26:03.000000000 +0000
+++ mutt-1.5.17+20080114/init.h	2008-03-13 12:26:12.000000000 +0000
@@ -1545,6 +1545,11 @@
   ** .pp
   ** The width of the sidebar.
   */
+  {"sidebar_newmail_only", DT_BOOL, R_BOTH, OPTSIDEBARNEWMAILONLY, "no" },
+  /*
+  ** .pp
+  ** The width of the sidebar.
+  */
   { "pgp_use_gpg_agent", DT_BOOL, R_NONE, OPTUSEGPGAGENT, 0},
   /*
   ** .pp
Index: mutt-1.5.17+20080114/mutt.h
===================================================================
--- mutt-1.5.17+20080114.orig/mutt.h	2008-03-13 12:26:03.000000000 +0000
+++ mutt-1.5.17+20080114/mutt.h	2008-03-13 12:26:12.000000000 +0000
@@ -527,7 +527,7 @@
   OPTPGPCHECKTRUST,	/* (pseudo) used by pgp_select_key () */
   OPTDONTHANDLEPGPKEYS,	/* (pseudo) used to extract PGP keys */
   OPTUNBUFFEREDINPUT,   /* (pseudo) don't use key buffer */
-
+  OPTSIDEBARNEWMAILONLY,
   OPTMAX
 };
 
Index: mutt-1.5.17+20080114/sidebar.c
===================================================================
--- mutt-1.5.17+20080114.orig/sidebar.c	2008-03-13 12:26:06.000000000 +0000
+++ mutt-1.5.17+20080114/sidebar.c	2008-03-13 12:31:11.000000000 +0000
@@ -221,8 +221,20 @@
 			SETCOLOR(MT_COLOR_INDICATOR);
 		else if ( tmp->msg_unread > 0 )
 			SETCOLOR(MT_COLOR_NEW);
-		else
+		else {
+		  /* make sure the path is either:
+		     1.  Containing new mail.
+		     2.  The inbox.
+		     3.  The current box.
+		  */
+		  if ((option (OPTSIDEBARNEWMAILONLY)) && 
+		      ( (tmp->msg_unread <= 0)  &&
+			( tmp != Incoming ) && 
+			( strcmp( tmp->path, Context->path ) != 0 ) ) )
+		    continue;
+		  else
 			SETCOLOR(MT_COLOR_NORMAL);
+		}
 
 		move( lines, 0 );
 		if ( Context && !strcmp( tmp->path, Context->path ) ) {
@@ -290,18 +302,22 @@
 
 	switch (op) {
 		case OP_SIDEBAR_NEXT:
+		  if (!option (OPTSIDEBARNEWMAILONLY)) {
 			if ( CurBuffy->next == NULL ) return;
 			CurBuffy = CurBuffy->next;
 			break;
+		  }
                case OP_SIDEBAR_NEXT_NEW:
                        if ( (tmp = exist_next_new()) == NULL)
                                return;
                        else CurBuffy = tmp;
                        break;
 		case OP_SIDEBAR_PREV:
+		  if (!option (OPTSIDEBARNEWMAILONLY)) {
 			if ( CurBuffy->prev == NULL ) return;
 			CurBuffy = CurBuffy->prev;
 			break;
+		  }
                 case OP_SIDEBAR_PREV_NEW:
                        if ( (tmp = exist_prev_new()) == NULL)
                                return;