>>>>Perhaps even more disturbing is that alot of these guys don't even switch their transponders on....so even if I am under a FIS/RIS its possible the controller may not have radar contact with potential conflicting traffic.<<<<
It is more likely they do have radar contact with conflicting or 'pop-up' traffic. It is possible that they may not be in radio contact, either because they are non-radio or because they are working another frequency. Some of us don't fly with transponders as we don't have sufficient power available for a radio, GPS and transponder.
The answer is the same - in the open FIR you keep your eyes open.