EEngr, I'm spotting it and dealing with it when they are at their cruising levels ...of course i wouldn't bother them during climb or descend preparations ...
I would say there are no immediate consequences on other systems ... although in certain situations the correct mode s id setting would become handy ... if for example our data processing system on ground crashes for one reason or another(it happened a few times) the first consequence is that all the correlation on the radar screens is lost ... meanning .. i won't see a callsign next to your aircraft bleep but only Squawk A figures for all the flights except those who have Mode S(they would retain corresponding callsings) ... if there were a lot of aicraft in the sector at such times retaining identification is more time consuming compared to the one when system authomatically correlates flights displaying their callsings next to little dots on the screen
The second reason I question the pilots of such flights is : if that ident feature of Mode S is there for a reason, then it should be correct . Its the foremost for their own safety sake and my peace of mind as well.
Chain of events is a curious thing, often leading to disasters - and you never know when such feature is going to take a part in an incident or thus preventing one.
Fly safe
1999