RE: does this pipe need to be replaced?
Stick that on the side of an F-100 and it's simply "Heat Discoloration" and adds to the "scale" look. I think BVM even sells a kit to simulate that effect on their jets.
The point is that some discoloration is entirely normal. What it should be telling you is that you have a hotspot ie your turbine exhaust is probably not completely centered in the pipe. Make the adjustment and recheck, but the pipe doesn't look damaged to need replacement.
David S