When the SCORM LTI tool used in Canvas was built, the focus was on using SCORM packages for assessment with the marks in the SCORM assessment being passed back to the Canvas gradebook. However, there are lots of instances where SCORM packages are created just for the purpose of showing content to students and not for assessment (or for more formative work where grades aren't necessary to be recorded in Canvas).
Where SCORM is content only, not an assessment, using the LTI tool results in a column being created in the gradebook, even if you update the assignment to be an ungraded assignment (it is still an assignment). The New gradebook can help with this as you can put those in an assignment group with a 0% weighting and then filter your gradebook by assignment group to reduce the clutter. However, this is still not ideal as the content is not an actual assignment.
There is another way!
You can embed the content itself directly as a module item in your course. Here's how you go about doing this:
1. You need to make sure you export your SCORM package in HTML5 format from your SCORM authoring tool. This will produce a ZIP file that contains your SCORM package.
2. Create a folder in your course Files and upload the zip file into that folder by selecting "Expand it"
3. Add a module item by pressing the "+" symbol for that module and select "File" as the item type
4. Find the .htm or .html file in the folder you created in step 2 - in my case it was called start_here.htm
5. I like to then edit the module item name so that it's not just the name of the HTML file
You now have a SCORM item in your module sequence and not in your gradebook!
I should mention that my colleague, Amelia Hayson, created a great guide on embedding SCORM content into a page. There's a little more involved to do that, but that is also possible. I like adding it as a module item as it means that it is not surrounded by other content and makes it easier to have it as a separate chunk of content so as to avoid the "scroll of death".
Also, another colleague, Daniel Gilogley, deserves a big thanks for his massive contribution to the genesis of this article. He's great!
Lastly, I can't finish this without mentioning that SCORM is an older technology and that it is a standard that has not been updated for over a decade. If you have the opportunity to use other tools for creating content, I'd recommend doing so. H5P is a standards based content creation tool that a lot of Canvas users are enjoying using creating engaging, responsive content. I'd recommend checking it out as a starting point.