I think they have to know. Training is what and how TES works. People have always stood on a bank and let Mudcrabs hit them to raise their Armor skill. there is nothing wrong with that. If you do NOT craft a lot of items, to sell or just to level, you will NEVER get to 100. Even after 300+ hrs. The same can be said for any skill. If you do not spend time with your One-Handed skill you be for ever getting it to much above 80. By that time you have exhausted that character and are ready to start another one.
Training - as I use it - means buying training from trainers. To me, that's one thing, and makes sense . . .it costs money, you pay someone, you get better.
But really, grinding is not - to me - playing the game. It's cheating the game. It may be acceptable to many gamers these days, but it's not playing the game. It's working. Now, if you want to load up Skyrim and create yourself a blacksmith, or an alchemist, that's fine I guess - I'm not here to tell anyone how to play their game. Go do that, make 8000 iron daggers or health pots or whatever, and sell them. Build up a crapton of cash and enjoy.
But it's an exploit, nothing more. It levels one skill - and your character in the process - while doing nothing in terms of gameplay. It doesn't make the game broken in any way - it makes your choice of gaming rather different than that of most others (i'd imagine) and can't possibly be what the designers intended. Whether you're making 574 iron daggers, or letting a mudcrab hit you 978 times to build up armor skill . . . it's not playing the game.
Just my opinion.