Rule of thumb:
Scratches aren't bad, until there are too many. If you have to ask if you have too many scratches, toss it.
If it's peeling, or the scratch has widened, get rid of it.
Teflon is PTFE (Polytetrafluoroethylene) not good to ingest.
Go out and get yourself a set of mid-priced stainless pans. I bout a set 3 years ago, and they are warrantied for life. The whole set cost less than 250$ and I will NEVER have to replace them.
Random Fact: An overheated Teflon pan, left on the stove can and will kill domesticated birds that you have in your house.
-SF
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