Contamination introduced by multilayer dielectric grating (MLDG) fabrication increases the risk of laser-induced damage when exposed to intense laser fields, consequently reducing the laser-induced damage resistance of MLDGs in picosecond-petawatt laser systems. While considerable efforts have focused on cleaning methods to minimize contamination, studies on optimizing the etching process remain limited. In this study, two different beam-current etching protocols were employed in fabricating MLDGs and thin films to comprehensively evaluate the adverse effects of subsurface defects introduced by the etching process. The results revealed that the etching process introduced penetration of fluorine contamination defects, and the degree of fluorine contamination increased in the high-beam etching (HBE) protocol. Furthermore, the quantity of typical shallow damage pits exhibited a significant increase in the HBE films under 7.6 ps laser irradiation, and the 0% laser-induced damage thresholds of gratings and thin films fabricated through the low-beam etching (LBE) protocol achieved significant improvements of 33% and 26%, respectively, compared to those obtained with the HBE protocol. The LBE protocol will be employed in meter-scale grating fabrication to improve picosecond laser damage resistance.