Lupin was truly afraid it would be hereditary. I doubt it was passed on, but as Winky said, the world had changed. Without Voldemort and the death eaters stirring the pot.

The problem with prejudice though is that it weaves in and out. So for a season something can be accepted and then all of the sudden it's out of favor again. So even if Teddy has werewolf tendencies that are accepted now, if the wrong people come into power again, he could easily be in trouble again.