I've been spotted several times, and usually I just explain a little about geocaching. But I did once allow some people to keep the wrong conclusion they jumped to. Up in the NE corner of Ohio I was hunting a cache that turned out to be under a covered bridge. I was fairly well out of sight when I found the cache, and when I climbed back into view there was a vanload of senior citizens out for a day trip As I was mulling over how to explain geocaching to septugenarians, I overheard one woman say, "Oh, look. He must be working on the bridge - see? He has some sort of instrument in his hand!" Well, I also had the printed page along with me, so I pulled it out of my pocket, consulted it, and "took some measurements" with my "instrument" and compared them to the "figures" on my paper. After agreeing with myself that all was well here, I got in my truck and left. When I'm not on two wheels, I'm usually in my plain jane silver Dodge pickup, which adds to the notion that I'm a worker at a given location, and therefore "supposed to be there." When it looks like this cover will keep me from being noticed, I don't do anything to discourage it.
Ed_S