I agree with the balancing act.
For me it's a combination of what card, what damage and at what price.
If it's a really common card I have kept several with paperloss, water damage, writing, tears etc. They came in lots I bought and I didn't have an example, so I just file them away with the others. Probably foolish, as the effort to figure out if a new card is an upgrade is often more than the value of both cards.
If it's an otherwise expensive card, any damage is ok with me as long as the price reflects the damage.
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