Nice. Well at least you've proven my theory wrong. He definitely can sense ki. He can't sense ki in comparison to himself or judge it any way other than an indicator. That's essentially what his ki sensing is, it indicates something is there, but that's it.
From a story standpoint it does make sense.
Remember just how strong Cell is. He was able to tangle with Kamiccolo and he's nowhere near his true power for his first form, let alone his second. He more than maxes out his first form, so much so, he actually considers himself too strong. I mean, this guy fucking tanks Kamiccolo's Full Power Light Grenade. Do you know how stupidly powerful this makes Cell? So much so, it's been downplayed by the fandom as a whole because they can't even deal with it. Cell is most likely at least 3x stronger than Piccolo here, yet no one recognizes it. All of this just to find out that there's an android on his level! He then absorbs 17 and his power becomes so great, we get perhaps the best tank in the entire series over his former rival.
He's essentially a God. So much so, Piccolo doesn't think anyone can get this strong...
I think the same goes for Buutenks/Buuhan. They are just so stupidly powerful in comparison, they can't help themselves from not giving a shit about anyone else's power I guess.