I have a 17 year old kayak that was faded and with any kayak that old, many scratches. I had read many blogs on this and no one had all the answers, but I got good info from many. So this is what worked for me. I focused on the areas that had the deep scratches first. I heated a spoon and would feather the scratch out. (if it is very deep, let it go) Then I sanded with a 220 grit sand paper, again, focusing on the scratches and progressing to a 400 grit paper. When I finished, I used my heat gun and went over the whole kayak. The smaller scratches seem to fill in and others would feather out. I used the Krylon Fusion paint for plastic. I was using the yellow and it did not mask out as well as I’d like but it looks good. That was 2 years ago and today it still does.
Fading more an issue of UV damage
Scratches are no issue on a kayak. Fading of the plastic that is noticeable will mean that the plastic has also become brittle. It will lose it’s flexibility in heavy surf and impact resistance, probably not something you would notice lilly dipping on ponds and lakes, but could fail if you take the boat out in rough water.