Edit2: probably solved. I didn’t understand that Brown is talking about Neo and Trinity’s attack.
Agent Smith is questioning Morpheus, trying to extract the codes to the Zion mainframe. Neo and Trinity have attacked the building in which Morpheus is being held, trying to save him.
(Office)
Agent Jones: What were you doing?
Agent Brown: He doesn’t know.
Agent Smith: Know what?
It feels too poignant to have a machine say this without there being something else to it.
Edit: what I mean is, a machine wouldn’t “retort” or be passive aggressive like this.
They’re not just machines or programs, tho. They are the typical sci-fi AI with full on human-like cognition. Unlike real world “AI,” the AI in The Matrix is actually capable of thoughts and feelings, so thinking in that direction isn’t necessarily off-base or too wild.
But I am pretty sure what they were referring to when they said “he doesn’t know” was the assault on the building taking place. Not that he was saying Smith doesn’t know what Smith was doing. He took his ear piece out when he asked to be alone with Morpheous and since he is bound by the rules of the Matrix, that meant he didn’t hear the radio chatter likely that would have alerted him to Neo and Trinity blowing shit up downstairs.