Whenever I build my character sheet, I always list Abilities and Lores under different headings, despite the fact the rulebook has them as the same thing. In my opinion, they are not: Abilities represent things your character has experience with, but Lores represent things your character knows. The difference between having done something a couple times before, and knowing something for a fact.
Take the Occult Ability for an example... it represents a character is used to dealing with such things and certain people, that they can recognize when things start getting weird, that he has some past experience in tip-toe-ing around this subject. Things that you can retests on. A Tremere is casting a ritual and fucks it up, oops, kncked over that candle... but he has two points in Occult Ability, he should have know better than to make such a mistake, he can have a retest.
It does not mean he knows what a Garou is, that they learn thier Gifts from Spirits, that they can move into the Umbra, etc. Those subjects are covered by Lores, representing how much truth a character knows. In our game, this rarely (if ever) comes up for retests, instead being a simple level-check to see if that character knows or recognizes something. Do you have any Garou Lore, and if so, how much? Okay, then you know what a Black Spiral Dancer is, yes.
A main problem comes when there’s a seperation in what a character supposedly "knows" or "has done" and what the character’s sheet says he knows or has done. This comes up when a character’s background says he’s "several hundred years old" or has "done and seen all these things", but does not have the Abilities or Lores to back them up. Bobby Brujah has been in both World Wars, Vietnam, and various mid-east conflicts, but has absolutely no Firearms ability. Tommy Tremere has read the scrolls at the library of Alexandria, perused the tomes at the Vatican, and studied in the secret places of his clans, but has no points of Lores to represent this. In this case, an ST will usually have to defer to what the sheet actually says, no matter how well written the backstory... afterall, that’s what the sheet is for; an absolute list of what your character can and can not do, what your character does and does not know.
Lore can admittedly be very gummy. Nick Nosferatu has seen Tremere do rituals and magic, has been to their secret Chantry, has met the Regent, etc, but has never actually put any Lore on his sheet. Sorry, then according to his character sheet, Nick Nosferatu does not know any Tremere Lore. Or, to put it a little better, Nick Nosferatu does not believe any of which he saw, does not remember anything he heard, and/or did not think it significant at the time. Magic? Neat parlor tricks and trickery of some Disciplines maybe, but not real magic... otherwise Tremere would rule the world, right? Chantry? I’m not sure, I think that was the name of a street or hotel they were at? Regent? Yeah, that was his first name wasn’t it? Okay guy... was he someone important or something?
I think most STs are fairly forgiving on Lores, as there is a fairly fuzzy line there, but if a character has good reason to know something that is represented by a Lore, that player should be putting that on the character’s sheet (however the mechanics work in your game, in ours, it’s a 1Xp purchase). You write to the STs and explain what you saw or heard or experienced that justifies the Lore. The STs can confirm that, and possibly approve the Lore, giving both the STs and the player a for-sure-for-sure stamp on a character sheet that this character does know this as fact.
It’s both a game mechanic and an administrative thing: when dealing with a player base of 20 to 30 people, an ST can not and does not remember everything single detail about every single background and every single encounter about every single character. It’s impossible. And not necessary. If an ST needs to know what a character can and can not do, does and does not know, he refers to a sheet. That sheet is gospel. And sorry, when an ST has to coordinate a game of said 20 to 30 people, he or she does not have time to discuss why a player "should" know this because of "such and such an encounter" in the past... your "flawless logic" can not pierce the impenetrable combination of "we don’t have time for this right now", "this isn’t logical real life, this is a game with specific rules", and the big winner of "then why didn’t you buy the Lore at the time?"