ORIGINAL: gibblet
this is generally caused by folks sliding the peep up and down without taking any pressure of the string, ie, not using a press. its the lazy way. a little fuzz is no big deal, but wax isn't going to heal the string, only hide the damage. you'll just have to see if a strand is damaged enough to break shortly or not.
Ditto. IF it is fuzzy, dont worry, wax it. If the string has strands sticking out, you have a problem. Most all strings will become fuzzy after shooting a while, not uncommon.