Coming from a plumbing background (LU230, San Diego, CA), if you're connecting pipe/fittings for a low-pressure air system (or water), then yes, use the yellow Teflon tape that is made for natural gas piping. Natural gas piping is normally malleable fittings with steel pipe using the NPT threads, which are tapered as mentioned. They don't really crush together, they simply form a seal via the taper. This might be for .5" > sizes.
If you're using pipe/fittings for high-pressure air, there could be an issue using the yellow Teflon, which maybe sufficient. The reasoning is that MOST Teflon tapes are manufactured with an oil based product So to be on the safe side, I use a product called Formula 8 (a paste), which is made specifically for Medical Oxygen piping in hospitals and is safe to use for any threads due to being inert. There is also a specific Medical Gas Teflon tape that I use that is not an oil base product, so is as safe as the paste. I only use these on high pressure connections.
My 2¢ anyway.
mike