Let's try to keep things shonen and respectful, okay?
Anyway, if you ask me, the whole thing just boils down to the methods used being wildly different.
The type of power-up that we see Vegeta, Nappa, and a few others do, is not quite the same thing as suppressing your power and then revealing it. It's more equivalent to being in a relaxed state when you're not fighting, and then "flexing your muscles" when you do. Their actual power level doesn't change, just the amount of effort behind it.Â
This is different from what the Earth-fighters can do, which is actually manipulating and changing their level of Ki at will. They also seem better at using their power, such as focusing it for high-powered attacks, which will read as a higher power level on a scouter.
Tried-and-true analogy time:
Regular resting power:Â Wearing a short sleeved t-shirt. Not really trying to hide your strength, but not showing it off, either. People can tell that you're pretty strong from seeing the muscles in your arms, but they only get a rough idea.
Powering up / "Surfacing" Ki:Â Ripping off your shirt and flexing. Even though you haven't gained any actual muscle, now everyone can see more of what you've got goin' on, and have a much better grasp on how strong you are.
"Suppressing" Ki / Manipulating power level:Â Wearing a loose-fitting long-sleeve shirt and stuffing a pillow in it. Now nobody can tell you've got any muscles at all.
Now when it comes to reading power, a scouter is much more precise and scientific. It will give you an exact reading for whoever you're scanning, regardless of whether they've "powered up" or not. But it can be easily fooled by people who can freely control their Ki output so as to suppress their true power.
On the flipside, sensing Ki naturally is advantageous in that it's more, shall we say, "intuitive." It operates like a sixth sense in battle, giving someone who's capable of it an edge in tactics and perception over someone who can't. A scouter may be able to tell you more accurately how strong someone is, but it sure as heck won't help you keep track of their movements when you're going blow-for-blow with them.Â
The downside of Ki-sensing is what everyone's been talking about; since it relies largely on how other people's Ki "feels," it's not as precise as a scouter when it comes to actually measuring power. You may be able to feel that someone is very strong, to roughly compare them to yourself, and if you're especially skilled even be able to tell if they're hiding more power or not. But it can be hard or impossible to get an accurate impression of someone's full power if they're not actually pumped up and using it.