I have been using the magnets that I scrounged from old hard drives, so I don't know how they relate to other sizes, strengths, pulls etc.

You definitly need some ferrous metal in the pin for it to work. And, truth be told, I have only done it where I was too lazy to solder or epoxy another attachment.

I can't say that it protects the fabric any more or less. It's just easier in some cases.