How far can I fall before it hurts?
Unless the beginning (before you find your uncle) area has different rules, it's 6/7 blocks
Here's the area I used to test it:
The platform with the sign with a skull and crossbones on it is where I let myself drop. That's 7 blocks high.
I also tried jumping off the side of it and took damage as well, but I'm not sure if the gravity is different after jumping. So unless that's different, it would be 6 blocks high.