How can they tell who's a Muggle?

[Tom Wall <thomasmwall@yahoo.com>]

No: HPFGUIDX 52530

<snip Elkin's excellent list of moments that wizards haven't noticed 
each other>

So I don't think that wizards are able to sense magical power.  They 
identify others as Muggles, I would guess, based on nothing more than 
superficial signifiers: manner of dress, for example.

I add:
That's right, and invisibility cloaks aside, Harry would seem to have 
no clue that Mrs. Figg is a witch at all.

In fact, I think that it's safe to say that Harry considers Mrs. Figg 
to be a muggle, from all the indicators we've gotten so far (well, 
end of GoF excluded) so would it be ridiculous to suggest that 
wizards could easily hide out as Muggles, if they were properly 
disguised and could conceal any uses of magic? I bet they could do 
just that, and that's why so many wizards were able to live in muggle 
areas. 

I mean, doesn't Mad-Eye Moody even have muggle neighbors? How's 
*that* working out? ;-)

-Tom