As far as I'm concerned, an IFF-less ship, should be regarded with suspicion, distrust, and even hostility if their ship, equipment, or actions warrant such a response.
In a real world situation, an aircraft of military type flying without an IFF Transponder would be immediately shot down upon detection, if it refused to identify itself, comply with orders given to it, or respond to radio communications.
It shouldn't be any different here, and that IS one real world scenario that it DOES make sense to apply here inRP. I would even argue that House Governments should move to make it a violation of House Law, for a ship to fly without a "discernable IFF Transponder Code".