I'm not sure what system Micechat is using, but I figure it's worth reporting the problems I'm seeing.
First, the system often continues to mark threads as unread with new posts, even though the posts have been viewed. Ironically it's not always all threads, but only some that somehow get 'missed' even though all threads were viewed the identical way.
Second (and probably simple known limitation) is that the marking system does not work well across multiple computers. If I read threads on one computer, and then goto another computer, they still show as having unread posts in my UserCP when viewed from another computer (even some time later).
I know with DB thread marking these things aren't issues and work well on other vb sites, but I don't know if Micechat uses that (given the site's size).