My hair is just past shoulder-length, and I'm looking for waist-length someday. I know you're suppossed to cut off any 'very damaged hair' before you can really start growing, but what qualifies as damaged? My hair is level 3 permanently dyed red with black tips. But it looks and feels healthy, especially after I started following advice from LL. I don't have any split ends somehow, even though I haven't gotten a trim in ages.

I only have about half and inch of 'virgin' hair at my roots. PLEASE don't tell my everything with dye has to go?

My suggestion to you is to take extra care with your hair when washing it,combing or brushing it, etc.

Can or will you stop dying it?  If not,maybe you could find a gentler product to do the job?  
There are natural ways to color(henna) and the black can be achieved by using henna and indigo.  If you color by way of store bought or salon,there are many products that are less harsh.
It won't be a short process,but the end result will hopefully  be healthy dye free hair!

Level 3 es no bueno. It contains both ammonia and peroxide which cause extreme dryness over time. I know that there are natural and vegetable-based haircolors available, but I have no experience with them. Several of the members here use henna and really like it.

If you insist on using drugstore or salon color, Level 2 is the highest you should be going.

I've only dyed my hair sporadically, never on a regular basis. And after reading around long locks, I know I'm never going to use it again! I know it's terrible for your hair..but will I have to cut off everything with dye eventually? Even if it seems healthy?

Well, the dye will remain in your hair so if you want to return to your natural color you will have to cut the dyed hair off.  I recommend going to a salon and having a color specialist blend your roots so as it grows out you won't have to continue coloring it.

So, trimming an inch every couple of months will help you get rid of the dyed hair and you won't loose too much length.  Of course, you won't be adding much length either but after the dyed hair is cut off you're home free to grow as long as you want!