I'd like to think that we have a certain level of understanding of topics like the conservation of energy. We understand that it is possible in theory to liberate enormous amounts of energy from the rest-mass of ordinary matter. However, we also understand that, in general, matter is stable, and this liberation takes place either very slowly, or under extremely energetic conditions. We also understand that building microscopic structures capable of resisting extreme conditions is an extraordinarily difficult engineering problem. Nanostructures that could bring these conditions about? Even more so.

Our level of understanding seems, broadly, a better level of understanding than a 16th century layperson would have of topics like the existence of electromagnetic waves and electricity, let alone the batteries, semiconductors, and software applications of semiconductors which ties them together.

He'll think more or less the same thing that 99% of people in the 21st century think.

That is, very few people know -- or care to know -- how their cell phone works. Those on this forum, of course, do. But, to the average man-on-the-street, its magic.

The difference is that a modern person knows that if they really wanted or needed to, they could find resources to explain how their phone works (beginning with electricity, electronics, programming, etc.)

The 16th century guy would be at a disadvantge for he'd correctly intuit pretty fast that nobody on the planet knows how it works and there is nowhere to get the info.

To be clear, I'm not saying that no magical-ish tech will ever exist in the future. I'm specifically doubting the physical possibility behind the imagined gray goo tech.