There's a lot of overlap between the pH of stomach acid in people and dogs. The pH [acid] range in people is 1.5 to 3.5, where lower numbers are more acidic. The pH range in dogs is around 1 to 2.2.

pH 1 is 10 times more acidic than pH 2. That's because pH 1 is an acid concentration of 0.1 moles per liter, ['10 to the minus 1'] and pH 2 is an acid concentration of 0.01 moles per liter ['10 to the minus 2'].

I'm guessing a nickel-sized felt pad is ok for a 7 pound Yorkie and that he'll poop it out in a recognizable form.

I was unhappy to discover that my guinea pigs had eaten a lot of a plastic bag, so I soaked a lot of their poop in water to break it down, and I found bits of plastic that were pretty small and degraded.

No, I don't think that a dog's stomach is strong enough to dissolve a felt pad. Felt is a material made up of fibers, which are long and tough strands, and usually cannot be digested. Fiber is actually a small part of balanced diets for dogs and for humans because it cannot be digested: it helps the stomach and the intestines to retain moisture and smooths bowel functions.