Costing items- have a major problem

I understand the fundamentals of costing items quite well, in a general sense, from an accounting perspective.  I set our global settings to FIFO.  I was under the assumption that this would residually affect any items created.  In our original implementation, the person implementing used "average cost" in the global setting, when many items were originally imported.  I have also found that several months after they implemented, he then changed the global setting to "specific costing".  Hence, any new items were now created using that method.

Last June, I scrubbed our system- removed all transactions- but not the items themselves.  I then made a global change to our inventory costing method. (as any logical thinking accountant would do) There were zero items on hand, so, this should have applied, as taken directly from "Help"