Hey there - first of all: Who is selling android tablets with a 1.6OS :O (Mine was shipped with 2.2)? But that's not the point so lets turn to your problem

.
When you do a factory reset normally you lose all application that you manually installed (that are not installed by default) - via the android market for instance. Standard applications (email, contacts ... basically all applications which are contained in the android image you're running) however are kept, even after a factory reset.
Okay - now i am not sure I get your question 100% ... Could u elaborate a bit further? When is this message being shown? Does your device boot at all?
Cheers,
Ready4Fajir