My stomach has shrunken to less than a quarter of it's previously monstrous size when I'm eating between fasts currently, and when fasting it is just a flabby sack hanging just above hip level. There has been periods where there has been a lot of noticeable extra skin hanging around but it continues to shrink noticeably almost from day to day at times while fasting. I was fully expecting to get more stretch marks from fasting and losing the weight so quickly though, not to lose the ones I already had. I also had them under my flabby arms, they are also gone now.
The body uses up excess flesh for it's day to day living while fasting. It makes sense that as your body 'digests' extra skin as it shrinks it would use the damaged skin, the scar tissue, first.