Many people would rather have their children genetically altered before they would grind gear teeth. Gears are not handed to us by God. They are designed by people who have figured out how to form steel into shapes that can be used to multiply torque and change power-shaft directions. Although some of us hold gears in very high esteem, they are not sacred. They can be ground on a surprising amount with little or no loss of strength. As long as the gears do not become hot (over 600 degrees) from the grinding, the molecular structure will remain the same and the hardness of the gear-set will not change.
There are many situations where grinding gear teeth is not only OK, but can be helpful. Some of these include, but are not limited to: grinding to clear the cross-pin shaft, removing nicks from shipping with poor packing, rounding the corners on chips from a brittle surface, trimming the ring gear toe to clear 9″ Ford pilot bearing, chamfering the toe of the pinion teeth to clear the carrier case, smoothing high spots due to machining, or back-cutting race gears to allow for tooth bending.
The drive side of the gear-set takes much more load than the coast side does and therefore it is a good idea to have a little restraint and think ahead before getting carried away on the drive side of a gear tooth. On the other hand, the coast side of the tooth gets loaded very little and not very often so it can take a huge amount of grinding with no negative side effects.
Although I have seen vehicle run with half of a ring gear or pinion tooth missing, I do NOT recommend pushing your luck that far. However, I have no problem running a gear-set in my own vehicle with 1/4 of tooth ground off of the toe of one or two ring gear or pinion teeth. If the same 1/4 of the tooth was removed from the heel, I would be wary. I would not recommend removing more than about a 1/5 of the tooth from the heel of ring gear, because most of the load is from the center of the tooth to the heel when under load. And, it is the heel of the tooth that receives the hardest load.
The pinion is another thing entirely. The last 1/4″ to 3/8″ of the pinion gear teeth do not even come close to touching the ring gear teeth on the drive side and therefore the tip can be removed entirely if the tooth or teeth are chipped, dinged, or damaged in any way. This heel portion of the pinion teeth often gets damaged in production or shipping and bothers people who are unfamiliar with rear end gears. If any part of the tooth does not contact other teeth, it can be removed without strength problems.
In order to improve my confidence when attacking a new gear set, I often practice on an old gear set right before I approach the new set. This helps me pick the right cutting tool, set the angle of attack, and find the best cutter speed before I begin. The main thing to remember when grinding gears is to make sure that all corners are chamfered and there are no sharp edges to cut into the other teeth.