If you do have your drive formatted as case sensitive, use Disk Utility (Applications->Disk Utility) to create a non-case sensitive disk image. Copy all the files over to said disk image and you should be good to go.
It's a little bit of a pain to mount the disk image when you need to look at the files, but probably far easier than attempting to normalize the upper/lower caseness of every filename & href in the html.
As far as I know, there’s no way to do it directly through the GUI, but there is a file you can edit quite easily. The file ~/Library/Safari/Bookmarks.plist contains all of the Safari bookmarks, including those saved to the Reading List. (For whatever reason, this file gets borked in TextMate, among others, but TextWrangler seems to cope just fine).
Anything beginning <key>ReadingList</key> is an item saved to the Reading List. There are two entries that control the title and the description. The first will be of the form:
<key>PreviewText</key>
<string>No preview available</key>
This occurs about six or seven lines in. Change this, and the description changes. The second entry is of the form:
<key>title</key>
<string>http://arxiv.org/pdf/1111.1763/arxiv.org</string>
and you can imagine what that does.
This procedure worked for me in Safari 5.1.1 in 10.7.2; I presume it should similarly work for you.
Two caveats: I have no idea what this might do to an iCloud-synced reading list. If the edit doesn’t get marked with the appropriate edit date, there could be some weird sync conflict brouhaha and Safari might explode. Also, I quit Safari while I messed around in Bookmarks.plist. No idea what might happen if you leave it open; probably nothing. But y’know. You can’t be too careful.
This is an example full entry for a Reading List item in Bookmarks.plist.
<dict>
<key>ReadingList</key>
<dict>
<key>DateAdded</key>
<date>2012-11-29T23:30:55Z</date>
<key>DateLastFetched</key>
<date>2012-11-29T23:30:55Z</date>
<key>PreviewText</key>
<string> **This is the short description** </string>
</dict>
<key>Sync</key>
<dict>
<key>Key</key>
<string>”C=1234567890"</string>
<key>ServerID</key>
<string>https://example@example.com+ABCDEFG12345</string>
</dict>
<key>URIDictionary</key>
<dict>
<key>title</key>
<string> **A web page that I’ve saved** </string>
</dict>
<key>URLString</key>
<string>http://www.example.com/readinglist</string>
<key>WebBookmarkType</key>
<string>WebBookmarkTypeLeaf</string>
<key>WebBookmarkUUID</key>
<string> 1234567890 </string>
</dict>
Best Answer
They're not being deleted, they're just read and you're hiding read items. Show unread items in reading list by clicking the Show Unread button above the list.