First: I got my new plates!
Second: I took a trip to Vintage Auto restoration in Scottsville. They specialize in volkswagens. I got to see a project they were finishing up: the most beautiful 1957 Beetle Convertible I have ever seen. The owner talked with me about my brake problem and said the most neglected part of the braking system are the hoses that go from the body to the wheels. Apparently, the hose inside them is very tiny - much smaller than the rubber hose would lead you to believe. According to him the rubber swells over time, eventually pushing on the actual tube inside and, often, leading to exactly the problem I'm having: you step on the brakes and they work, you let go of the pedal and brake fluid doesn't flow back into the cylinder.
It's much easier than changing the master cylinder, so I'm going to give this a try. More later.
Here is a picture of that '57 beetle convertible:
