...I've read many articles about page rank loss from 301 redirects
You are right that there is a loss of PR from a 301, but it is going to be very small.
In terms of managing the site, long term, you are going to find it much more straight forward to take the route of tidying up.
I have just been through this with a site over almost 2000 pages and we didn't notice any drop in the SERPs at all. However, we did see a few uplifts, but there could have been a few other reasons for this as well.
If you were changing the URL's to try and gain favour with Google by having more friendly URL's, I would tell you not to bother. This, however, seems like a worthwhile change.
-Andy

