Everyone does know. I can't speak for all states/counties/cities/etc, but the brown bag thing is mostly a legal grey area for allowing folks to drink in public. Most of the time drinking isn't legal to just do while walking around and can be given fines by cops. However this can be problematic for additional resources being redirected from more important crimes. So as long as the cops don't see a label or the whole bottle/can, then they can ignore it as "it could be anything."

For example, in the summer people in my state like to go tubing down sections of rivers. While tubing you can have coolers and stuff, however open drinking of beer or other such drinks isn't legal. So if cops were to be watching the river and clearly see the labels it can mean that they order you to get out and hand them over and/or be fined. But everyone makes sure to put their cans/bottles in foam cozies, and therefore it is a low-key unofficial understanding that as long as you aren't smashed and/or causing lots of problems everything is good. The same also applies to other places like lakes and the beach (at least in my state). But if you are super drunk and/or being an asshole, then the cops will use that as probable cause to actually search the bag/cozies and all that.