Binocular icon - what's up with that? ...

[Outlaw Josey Wales]

Actually, they should make it where you are spotted if your unit in turn spotted the unit spotting them. If you have been fired upon, it's a given you have been spotted 99% of the time (I have read before where arty units would fire blind by the map at intersections or trails at random intervals so the enemy using them couldn't time a safe passage). If not fired upon and not spotting an enemy unit, you should not know you have been spotted. If you have even been on a field exercise or real combat situation where you spot opposing forces and only report the location without firing on them, they won't know they have been spotted.