Is it safe to cook in a Teflon pot that has blistered and peeled and produced fumes from previously being heated too high? This is what the bottom of the pot looks like   
The simple answer is not really.  Avocados have a high fat content relative to other fruit, but they're only about 20% fat, which is much less than any other cooking fats.  If you add enough avocado to provide the fat content for a cake, you'll also be adding too much water and all the other flavours of avocado, which I assume you don't want. 