But only if you put the tape over the edge. I usually leave the first 2 threads uncovered, why would it fall into the stream if you don’t cover the tip of the thread with it?
The most installed/removed NPT thread will leak the most thus have the most tape added and the scraping of installation/removal will guarantee teflon contamination of the system eventually.
You are also correct in that something installed one time for the lifetime of the system, especially with some care and attention to cleanliness, is almost certainly OK.
There’s no problem applying it to a threaded connection in PVC. Unless you mean that you’ve figured out a way to apply to a fitting that’s meant to be glued? In that case I commend your abundant creativity.
My experience is that even one wrap of PTFE tape on threaded PVC causes it to loosen and then leak, and it's recommended by youtube/google to not use it. (Some say sealant is ok).
Its not that the Teflon reacts with hyd oil, its that the inevitably little tiny bits of stuff physically jam/ruin seals and clog nozzles.