Well I'm very new to caching myself, but seeing broken junk in a cache is just a total downer, so we are trading up and leaving more than we're taking. I see no problem removing a plastic car with no wheels, broken pencils or pens and the like. Now maybe someone *wants* a wheel-less plastic car but I shudder to think what they might trade for it.
I guess if you're replacing broken items, nobody is going to complain...and it's good geokarma so why not?