With the sex thing! Hong Kong thinks homosexuality is gross, but he's much more accepting of it among nations because they're not human after all- and technically they're as much women as they are men. My other Hetalia muses that have nothing to do with Discedo but I still end up using for head canon are much more open minded, because that's their society, but they still view nations as different than humans. Different rules, different sex lives, etc. Hong Kong really is a virgin, because he can't bring himself to get close enough to a human to have a relationship and he's not the type for one night stands. So yeah.

Humans! I think that most of the population know countries exist, but they don't know them personally. Obviously bosses and important figures know, but not everyone. I like the idea of humans feeling instinctively close to their nations when they see them, without quite knowing who they are.

Before countries! Hong Kong knew all his life because China told him, but I think countries that were more isolated wouldn't have? Like, they knew they were different because they weren't aging but they weren't sure why. America mentioned something about "realising" things about himself in the chibi strips, right? That was probably him realising who England, Finland and France were and that they were the same as him. Or maybe even just realising not what they were, but that they were the same as him and that he wasn't just this one weird anomaly.