Alexei, there are two points I want to make.
1. I think that the scale (Unc, XF, VF, F etc) is fine. They might be used for Soviet medals and orders. But;
2. The Krause standards was made to be used on struck coins in general circulation. The Krause standards are just one variation of a very complex system of grades developed for coins - and have many variations in the world. They will even be tailored for specific series of coins. (Their definition of Unc is not the best, most collectors have higher standards).
For orders and medals we can use the terms, UNC, XF and the others, but we have to put new definitions behind them.
First of all. Coins and orders have a very different circulation story. Most medals can be quite attractive even when they have seen heavy use. Most of the image on a medal is visible even if the medal have seen heavy use - worn on many Victoryparades. Second. Coins and medals are manufactured in a quite different manner.
Well. I like the scale used in most COA from McDaniel. Best out of 10...but we can of course discuss what a 8 is or if it is a good or bad 8...
I have some thoughts on the coingrades applied on orders and medals (but I will hope some people with more experience will have their say in this, my background is coins and not orders):
Unc - Unissued without imperfections.
Au (Almost Unc) - Unissued or issued, one or two small imperfections. Have seen little use.
XF - Nice, have seen use, not many imperfections.
VF - Very fine medal or order, have seen use, some imperfections due to contact with other medals.
F - Fine. Used medal. Several imperfections and/or traces of polishing.
VG - Very good used medal or order. Many imperfections and/or probably repaired enamel on orders and/or heavy polishing.
G - Good used medal or order. Seen heavy use. Damages or repairs.
AG - About good. Collect only if the medal have been in action at the Reichstag!
I prefer orders and medal that have seen some wear, have a nice history, but is otherwise in a problem free condition. (I have really problems with accepting enamel damages, but have no problems with scratches or dings. But thats just me. I don't like Unc orders or medals or coins.)