Thread Breaking sensor
A piezoelectric sensor might be what is used. Each time the thread moves it outputs and signal and if the thread breaks and stops moving there is no more thread signal.
Sparkfun has a piezoelectric sensor that might be useful. I don't find any documentation and am guessing the thread can be threaded through the brass hole?
For the thread break detector you need to sense even one thread breaking. That is quite demanding because the threads are very thin and would not block much light. A high resolution optical line sensor will work, and not have any contact. It will require a computer to monitor the image and detect a missing thread.
To elaborate some more: The sensor could also be some version of camera, and the lighting be from the side so as to provide a maximum amount of contrast. Then the software will need to be able to monitor the image where each thread should be.
Read "Video Systems Design magazine on line to see adds from the folks who integrate those systems. That is not me.