I believe the logic behind restoring back from scratch is to insure that you don't bring any issues that were associated with WP8 stuff or other things(apps) that could have been causing issues. Starting from scratch eliminates this possibility, then a slow, careful reload can pinpoint suspect apps.
Sorry to hear it didn't work tho. Before you reload or restore anything hard reset it some more. It can't hurt and since your already there. Others have said a third hard reset is what worked. Just to verify, you did lose all your stuff and your 1520 went back to factory fresh out of the box condition correct? Of course 8.1 is still there.