I just did some random search - Hand-processing technique of Long Jing (this can be google translated)http://www.tea0571.com/Article/hangzhoutea/besttea/200812/55.html
In both part 1 (processing of high grade products) and part 2 (processing of intermediate grade products), the last step include "sift-removing crushed leaf pieces and fluffy balls" - these fluffy balls will not be in perfect ball shape as in beachape's pic1 and pic3 and will mostly be removed. Depending on cultivar and individual worker's operation, there is sometimes some small patches of fluffs on the leaf surface that can't be removed (like in beachape's pic2, but color of this picture is too green for a Long Jing, may have been photoshoped).
In part 3 (processing of lower grade products), there is no such as step of "sift-removing crushed leaf pieces and fluffy balls", because lower grade leaves lack silver tips. So ultimately the flavor and leaf shape are quality factors of a tea, and whether or not there are fluffy balls may not exactly indicate the quality (unless there are too many, meaning some of the leaves have been stolen by somebody