Please note the following is a "DO AT YOUR OWN RISK" deal. This is what I did on my iPad and in my iTUnes and I accepted the consequences of what might happen. I will not guarantee this will work on your iPad/iTunes, nor will I guarantee this will not cause your iPad/iTunes to behave erratically.
Actually, there are two things you can do. The first one applies to all - you don't have to be jailbroke. The second one you can do if you are jailbroke ... if you want to.
The first thing to do is to save a backup copy of the XSysInfo .ips file somewhere other than in iTunes (the old version - 1.4.4). Just in case...
In addition, these are instructions for a Windows machine (I don't know if it'll work the same on a Mac). Specifically, these directions worked on my Windows 7 with iTunes 10.3.1.55. Oh, and thanks go to Elit3, who discovered the process. So, without further ado:
1. Be in iTunes
2. Click on Apps (in left column)
3. Scroll to and then right click on XsysInfo (in the right side area)
4. Select "Show in Windows Explorer"
5. Copy the XSysInfo.ipa to your desktop
6. Right click on it and select "Open with"
7. Open file with winrar, winzip, 7zip, etc., something so you can see all the files (WinRAR archiver is what I used…)
8. Open the iTunesMetadata.plist with Plist Editor (a free program for Windows; found on the 'Net)
9. Search for the phrase itemID
10. Delete all the numbers except one in the line under itemID in between <integer>[delete all but one number here]</integer>
11. Leave one number remaining (any number, doesn't matter which one)
12. Save the file in place
13. Double click the new .ipa
14. When iTunes as if you wish to sync or replace the old version with the new, select yes
15. Done! No more update badge (iTunes will no longer show XSysInfo as needing an update)
Or, for the jailbroke people, you can change the itemID in iFile (or do both, if you wish):
Go to /var/mobile/Applications/XSysInfo and open the iTunesMetadata.plist file using iFile's built-in Property List Viewer.
Scroll down until you find the line itemID. On the right side, you will see a bunch of numbers. Remove all the numbers but one. Doesn't matter what number is there, so long as there is only one. Then, respring the iPad.
That's it. The App Store will no longer see this app (in fact, it'll show it as not installed on the iPad). And - the badge for that upgrade will be gone...
Let me know if any step is confusing...
Marilyn