Those are interesting ideas, and I'd love to see what more people think about them (in particular, the listing of 'mastery levels' instead of % correct underneath lessons).
Just off the top of my head, though, there's a number of problems I can think of that need addressing. First off, it'd be much more expensive (in terms of how much time it would take to generate the data each time) if it had to get an average mastery rating for all the terms in each lesson that was requested. A *lot* more expensive. This isn't something that the users can help with, but I wouldn't want to do anything that would dramatically slow down the speed at which a user can peruse lessons.
The other major (only?) issue would be the display.
1)While the site does use stars almost exclusively for mastery ratings (the only exception I can think of are the ratings for the external resources), stars (when paired with a list of things) tends to give a meaning of 'popularity'. So if we were to switch from the colored bars to stars, it might appear as if the lessons are getting rated . This could be fixed (although it would, at the same time, introduce complexity by having two ways of displaying mastery levels) by sticking with the color bar.
2) (this applies to both the color bar and the mastery levels). The bars are currently there to provide two key functions: (1) show personal progress on a set of materials, and (2) give encouragement to the user. The first one makes sense; the second one more so in that if a user glances at a set of lessons, they can easily see which ones they've done well on, and it helps them to move on (at least, I believe it does).
Let's presume that we switch over to mastery levels. A full set of stars (or full color bar) on even a lesson with a single term takes over a year. The first 4-5 levels can be gotten within a month, but the last half of the stars take much more time. What this means is that if a user studies a few lessons intensively over the course of a few weeks, then might still only get their bar/stars up 30/40%. While most people realize studying is something that is ultimately done over a long-term period, I fear that it would be detrimental if it takes that much time to (visually) appear to have made progress. I hope that makes sense.
Of course, this is all complete conjecture, so I'd like to hear what other people think about it. I *do* believe that mastery levels are a much more valid indicator of progress than '% correct', so if there's a way to effectively implement it that wouldn't be a)confusing and b)demorializing, I'd definitely be interested.