Yeah but they were a bunch of people who probably hadn't been to the capital territories in a while, if at all. Kenobi and Luke wouldn't know anything, while Han and Chewie may have heard whisperrings but never actually cared enough due to their dealings as smugglers in outer rim territories.
I mean, I'm sure SOMEONE in the Senate would have said "OK dude, WTF does that do?"
"I'm building a moon made of metal to keep all of the Gungans stored on it" wouldn't fly as an excuse.
The Senate obviously knew about the Battle Station anyway. Leia, a forerunner in the Senate itself, knows of the stations capabilities. I doubt it is a secret.