To wit: update and compile; stop the daemon and simplewallet; delete poolstate.bin from ~/.bitmonero or the Windows equivalent; replace the daemon and simplewallet; restart the daemon and simplewallet.
Important note:
Make sure to do it in this order:
1. Stop bitmonerod
2. Delete file poolstate.bin
3. Start (updated) bitmonerod
If you delete the file while bitmonerod is running, it will be recreated with the old spam transactions still in it.