Perhaps run it by a few dentists, but its probably similar to thumb-sucking where the majority dentist opinion ended up being "don't worry about it - the teeth will straighten on their own later".
I agree that he might not be ready to get rid of the blanket. Forcing this before he's ready might turn out totally fine, but there's a chance this experience of loss could be very traumatic & harmful longterm. I always like to let kids do things on their own timetable - when it's CLEARLY well past time to let go of a "younger" habit, your kid will have a sense of this too & it'll be an easy conversation. "You know, Son, I don't think any other 10 year olds still sleep with their chewed up old baby blanket. Maybe you better let me put that in a safe place for you." "Yeah, Mom, you're right. Here you go." LOL. OK, 10's a little extreme but you get my idea. Kids will do these transitions on their own almost always, and when there's no question that it's way past time, really it shouldn't be that bad when you point it out. First sleepover with friends might be the trigger to lose the blanket for example.
Some people never give up their night-time security items. As a doula I've learned that it is not uncommon for mom to have a special baby pillow or stuffed animal or cloth of some kind that's been her comfort item her whole life. She uses it heavily the first 1/2 of labor for comfort (I am sure to remove it from harm's way when labor gets really intense but she uses it through the first half or more). True these have been first-time moms more often than not, but not necessarily young (mid-late 20's). I also had a friend once who still sucked her thumb at night in her mid-20s & she was a mother of 2. And her teeth were fine - go figure.
My 7 year old was a "blanket" baby.
She had her "little blue blanket" which was actually a dress scarf of mine that I'd let her play with. She COULD NOT go to sleep without it for the longest time. She would play with it all day in various ways, then at night she'd put it across her face or wrap it around her hand & arm & sometimes suck her thumb through it. Glad she didn't chew on it because it wouldn't have held up. She weened herself from her little blue blanket on her own in a very deliberate way. She would say "I think I'm getting too old for this, I don't want to sleep with my little blue blanket tonight". Then sometimes she'd panic & change her mind & run & grab it. But other times she slept without it. It was soon long forgotten. But as soon as the little blue blanket was gone, she started chewing on her sleeves (actually I think those habits overlapped some). This was a bigger problem because she was ruining clothes that she loved. She eventually stopped that crazy habit mostly on her own (we did press the issue on this one but there was nothing we could take away from her cold turkey - it's not like we could just not give her access to anything with sleeves!) Oh & she chewed on her hair for a while too but her big sister laid into her about that one more than we did & she was able to stop that one without too much trouble.
So now (at just 7) all she has left is occasionally sucking/chewing on her inner-upper arm (yikes). I actually don't even know how she can reach that spot. But she gives herself little hickies. It'd been a while since I'd seen one, but I saw one just yesterday evening. Again her big sister was the really horrified one & made her go show me (I'd actually already noticed it.) We talked about how she was actually injuring her body a little bit when she does that even though it isn't painful, and it's really not a good thing. She seemed to get it this time. We'll see.
I think your son is fine. Don't worry about it just yet.
:)
S.
Mother of 6