The history file doesn have any effect on the Location or Netsite pulldown menu at the top of your browser window. To find out how to clear that, please see How do I clear the Location (Netsite) pulldown menu?
Netscape Navigator and Communicator maintain a history file to keep track of every web page you’ve visited recently. This file remembers every URL you’ve accessed, including every web page you visited, every image on those web pages, and every file you downloaded through Netscape Navigator or Communicator. This is to let the program remember what web links you’ve already visited so it can make the visited links show up in a different color than the unvisited links.