A DISCOVERY! (for me anyway) ...
By un-checking CACHE from the list of "Clear Recent Data" items, the feature works normally, and there is -NO- slowdown or lockup.
I've now created a direct shortcut to the Firefox-4 Cache Folders. Until there's a fix in future versions, the procedure for me will be this -- after doing a "Clear Recent Data" on Firefox, I'll exit the browser and delete the Cache folders 0-1-2-3-4-5-6-7-8-9-A-B-C-D-E-F, which should not be fatal since Firefox re-creates them every time you run it.
About Firefox-4 Updates - I'm a little surprised we haven't yet seen a release of a 4.01 or maybe 4.10. Aren't there any other issues with the current version?
UserAgent: Mozilla/5.0 (Windows NT 5.1; rv:2.0) Gecko/20100101 Firefox/4.0