When can I ignore related work in my paper? In many fields it is conventional to discuss related work in your paper.
This lets you show where this new contribution sits in the literature, as to what novelties it adds over existing works; and to introduce works that you will later show how their techniques were adapted for the new work.
One can certainly have papers rejected because the related work section is not up to scratch.

My question is can one draw a line as to what works are worth discussing based on the quality of the work in question?


Obviously, if a work is not closely enough related, one does not need to discuss it.
If one is contributing to a well established area, then there is no space to discuss every work, so many can be skipped.
But what if there is only a small number of works, that are related?


To use as an example what is prompting me to this question,
the current work I am on is fairly new.
There are only 5 related papers that I am considering discussing.


2 on the inverse problem, 1 on a more general related problem, and 2 that are closely related.
Of these all baring 1 are published in top-venues
The remaining one, looks like it was an assignment.


I found it, via google scholar, at the URL: http:://www.&lt;famous-university&gt;.edu/&lt;unitcode&gt;/reports/&lt;title&gt;.pdf
It is formatted like a paper, which tends to make google scholar index it.
It may have been in preparation for a smaller workshop.
It was fairly well written; but lacked any kind of quantitative results, or even many qualitative results

However, this remaining one is one (of the two) closest related works.
I feel like I could include it, but if I did I would have to be quiet cutting as to its limitations. 


I am in Computer Science
Did the paper you're asking about contribute to your knowledge of your topic, or to the analysis or contextualisation of your results?

If yes, you should include it, wherever you found it and whatever it was originally. You might have to qualify your use of a non-conventionally or accidentally published source (if Google Scholar scooped it up from a random webpage the author might not know it's out in the wild). But attribution of sources is non-negotiable.

If no... well it might be up to your judgement. mts's comment about calling it a "related discussion" might be worth considering. If the typical practice in your broader field is to mention significant literature by way of contextualising your own work, I would probably leave this one out (due to the aforementioned questionable provenance). That particular document is unlikely to be a widely significant piece of literature. If the typical practice in your broader field is to mention as much as possible, you might be inclined to include it. A lot depends on how your field typically does things.

Which makes me think: have you been as thorough as possible in checking the author's body of published work, to make sure the same material can't be found somewhere more reputable? If it can, use that instead.