Question 1: Can we remove all instance?
Unhealthy instances can be replaced and
WEBSITE_HEALTHCHECK_MAXUNHEALTHYWORKERPERCENT tells the platform how many of those instances can be replaced when the app is determined to be unhealthy.
Question 2: what is the max value of WEBSITE_HEALTHCHECK_MAXUNHEALTHYWORKERPERCENT?
You can set the value to a max of 100 which means all worker instances can be replaced.
For more information, please reference https://learn.microsoft.com/en-us/azure/app-service/monitor-instances-health-check#configuration.