I must be running an older Kernel that can do 1300 but it had serious issues with anything graphic in nature. Most games and even the ADW Launcher would Force Close or simply lockup. I have been running 1200 for several weeks and have never had a problem that I believe was related to the overclocking. I don't know that the added 8% speed bump would be all that noticable anyway.
Dalingrin's kernel from 6/30/11 can go to 1300 (and higher). Some people can get their Nook stable at those speeds others not so much. Download links are on page 1, more recent info is much later including multiple suggestions for core voltages. I think it also has some audio fixes.
Most people seem to have major FC issues beyond 1200 mHz. I have been able to push my nook to 1250 stable but beyond that I seem to have problems. I am running cm7.1 rc1 with dals OC and nook tweeks.