I think the confusion in this topic comes from the misnomer of disability and it's blanket use - they really need a different term but they only use the one. VA disability certainly can include real disablity that prevents you from holding a job or a Type I physical. However, it also includes any health issues you developed while on Active Duty that make you not as healthy as when you entered. Examples, bum knee from a sports injury, hearing loss (but your hearing is still good enough to hold a type I but not as good as when you entered), a chronic health condition that developed on active duty (thyroid problem, blood pressure etc), even a hysterectomy or vasectomy. You absolutely can and should file and recieve VA disability for these types of items. Yes it is purely between you ann the VA and as long as you are honest on your physicals there are no issues.
The VA rep explained it like this when I seperated: You enter Active Duty as a brand new car with a full tank of gas. The military drives the **** out of you and then trades you in for a new car. The VA compensates you for what was used out of your gas tank and wear and tear on your parts. Will the car still run and operate? Yes, but not as well as when it was new. That is the basis for the compensation.