Here's my interpretation. The crew seems to be caught off guard by Goku's power up and it ends very shortly after. So they can sense it, but they didn't have a lot of time to evaluate it fully.
As Piccolo is training and gaining closer and closer to Goku's power he fills up with hope and begins to restore pride in his abilities. He will be the one to defeat Cell just like last time. But wait... Piccolo knows Goku all too well. All these years he's known Goku. He knows exactly how he is. He starts to think that with Goku, there is always something more, hell, I bet he even has more power than what he showed in that glimpse. As times goes on, his hope fades and he starts to panic, knowing what he knows of Goku, Goku is not only a little stronger, he's probably a whole lot stronger. Piccolo's perception of the situation begins to grow somber as he is relegated to the fate Goku talked about. The one in which Goku with all of his mighty power, still can't get it done. Piccolo's gains have started to see some harsh diminishing returns over the last month or two and his power now has matched what Goku had shown before, but was it all a waste? He estimated Goku to be far stronger than himself, 1.5x stronger, a point in which Goku can defeat 3 versions of himself easily. He is powerless. He is useless. He decides to end his turn as it is rather pointless at this point.
He has the conversation with Goku, which reveals he had held onto a little hope for his power to be relevant one last time, but no, he is doomed to mediocrity once and for all. He has maxed out his abilities and they are nowhere near acceptable at this level. Later while waiting for Goku to unleash his full power, Goku reveals he is no 1.5x more stronger than Piccolo, which was already incredibly superior, he is a whopping full 2x stronger, making Goku go from being a demi god to a full on God.
This interpretation is appropriate and no one can provide a better one, thus this idea rules the day KP. Until you can beat this, suck it easy baby!
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