Copyright is a governmentally created monopoly that protects a specific creative expression of an idea. The full Project Gutenberg license is no doubt protected by copyright.
My understanding [I am not a lawyer, consult your lawyer] is that legalize is not subject to copyright. IE anyone can use legalize. I read the PG legalize as saying that efforts required to file format translate from one file format to another can still retain the PG license terms. If your effort is primarily focused on getting the PG work to work correctly and completely in a new file format, then I would hope that PG would allow you to retain the PG terminology. If you effort goes beyond this, making a "vanity snowflake" because you think that paper backgrounds are better in pink, and chapter titles ought to be in blue underline -- for example -- then I would hope that you would remove the "PG". Or if you are using the PG work but then norming against another work, such that the body text doesn't match, then I would think you should remove the "PG." Also note that if you keep the "PG" then you are committing to distribute a plain-txt version to anyone who complains that your version isn't faithful to the PG version. Not that that ever actually happens. Also, please do not follow a common practice on mobiread of scarfing a cover page from a contemporary printing of the work! Such cover art I could think might be under current copyright.