Actually, there were two different versions of the complete collection released and only one of them has major issues with the discs being scratched up and loose when you open it. It's the one with the "cave" packaging seen here...
http://www.amazon.com/Fraggle-Rock-...17?s=movies-tv&ie=UTF8&qid=1335737407&sr=1-17
The problem seemed to be the paper sleeve type of pages in which the discs were kept. The discs didn't seem to hold them very well. Additionally, the design of the packing is a little wonky for people who actually want to use the DVDs. Looks great on a shelf amongst other Fraggly goodness, but isn't very awesome when it comes to functionallity.
The entire series was later re-released with different packaging seen here...
http://www.amazon.com/Fraggle-Rock-...D2LW/ref=sr_1_2?ie=UTF8&qid=1335737386&sr=8-2
Both are the exact same discs, just different packaging. The second one being more traditional style DVD cases. I would most assuredly recommend the second set to anyone worried about getting scratched discs from the paper sleeves that housed them in the first release. It comes as four seperate season box-sets housed in a cardboard slipcover. Bottom line, the first release with the "cave" style packaging is great for collectors, but the second "traditional" style release is much, much better for typical DVD use.
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