I am attaching a patch that is 5-th and last in the series for my
proposal.  This patch applies on top of the 4-th patch visible here:
http://debbugs.gnu.org/cgi/bugreport.cgi?bug=11095#26.

The patch adds an ability to un-highlight all highlighted text in the
buffer via a prefix arg.  See Part-II/Item-2 below.

ps: I am following up this mail with a consolidated patch, just in case
someone needs to try stuff out.