The non-contact indicator is perfect for identifying the hot on K&T provided that there's no load on the circuit in question. That way the neutral won't be energized, and won't show as "hot".
One has to unplug everything from the circuit in question,and the lights need to be turned off. The only possible load that I can see coming back on the neutral in that case would be a transformer such as the doorbell or a smoke detector.
If you know the non-contact's limitations, it can be an invaluable tool. It only indicate the presence of voltage (try one beneath overhead HV lines sometime).
It's not the only tester that you need to carry on your truck, but it does have its uses.
I carry about 10 testers (DVM,analog meters,solenoid type testers,etc.), use them all, depending on the circumstances at the time, and never, never put my trust in any one of them alone to verify the absence of voltage.
