should saddle develop small grooves from the strings

[Walkerman]

I noticed one of my saddles is getting small grooves from the strings.  Is that normal/OK?

[unclrob]

Yep,metal rubbing back and forth across bone or plastic will do that.Though its best to replace if your carefull you can clean it up with some very fine sandpaper just be carefull not to change the shape or the take off point of the strings.

[Zohn]

That is usually also the most likely place for a string to break - it certainly happened to me before. 

[cke]

That is usually also the most likely place for a string to break - it certainly happened to me before. 

Is this the reason to 'fix' the indentation? Is there any other effects?

[Zohn]

Is this the reason to 'fix' the indentation? Is there any other effects?

Yes, the nick or notch is usually sharp edged, but also may be a tad smaller than the dia of a new string which causes it to pinch the string in its relative position and in so not allowing the string to travel as smoothly over the saddle's surface when tuning (stretching) the string. That in turn creates a stress concentration at that point on the string.
This phenomenon is most prevalent with nylon strings, but I have had breakages with steel strings as well, and found they worked better after smoothing the bearing surface of the saddle.
The same effect applies to a nut with its slots pinching "larger than normal diameter" strings - like when fitting .013"s to a nut slot that is only wide enough for a .011" string.

[rockstar_not]

When you sand the saddle, make sure to take the approach to sanding from the lower bout side of the saddle, not the top nor the neck side of the saddle.  This 'should' give you the least amount of string length and string height change.  I've had to do this on the TUSQ saddle supplied with my Larry more than once.  I also performed this job on the Mission Trip Guitar that I recently delivered to Peru.  (if you're interested - the story of the MTG is here:  www.missiontripguitar.blogspot.com )

-Scott

[Zohn]

I also performed this job on the Mission Trip Guitar that I recently delivered to Peru.  (if you're interested - the story of the MTG is here:  www.missiontripguitar.blogspot.com )

-Scott

Great story Scott - thanx for sharing...

[Danny]

  My F-IV had score marks when I received it. It also had a shim under the saddle. Go figure
I made adjustments to the neck problems, lowered three high frets and through away the shim. (no I still have that to give back to Larrivee someday)
                    I don't care for Tusq saddles or nuts. Bone is the way to go.