After playing Breath of the Wild and now most of Tears of the Kingdom, I've been thinking about the interaction of things that people and creatures in the world can or can't see and interact with.
I'm not going to say anything specific to TotK, so I have not spoilered anything below. This stuff is all true based on BotW, but may or may not have been included in the second game. I mention the second game because it's another "primary source", because it's canonically in the same world, and because it's on my and some other folks' minds lately.
Nomenclature
In the world of Zelda games on the Switch, there are animals based on real life animals like deer or frogs, there are citizens of Hyrule like Hylians or the Zora, and then there are monsters like Bokoblins and Lynels. Everyone in each of those groups can see every member of each of those other groups.
In addition to those groups, there's another group of creatures that exist that may technically be listed as animals in the Hyrule Compendium, but for one reason or another, I think they should be separare. I like to think of these creatures as cryptids, owing to the fact that they're mysterious, have magical powers, are rumored about, and/or are plain invisible to the average citizen.
These cryptids include but are not limited to:
- koroks
- blupees
- fairies
- great fairies
- the horse god
- the lord of the mountain
- dragons
Let's talk about each one individually.
Koroks
When you first happen upon a Korok, it will be surprised that your kind can see children of the forest. These are creatures Link can see, but other people in the world cannot. They can hide from sight until you've completed their puzzles and they give you korok seeds which have "a distinct smell" but it is unclear if anyone besides you and other koroks can see the seeds. Presumably since the seeds belong to Hetsu for his maracas, you're not allowed to sell them, but it's unclear if anyone would be able to see them even if Link tried to sell any.
Blupees
These blue glowing rabbit-like creatures are known for dropping money when damaged with weapons and disappearing when you get too close to them. There's a Korok quest to find a blupee, so it's clear they can be seen by the children of the forest, at least. Based on compendium entries like the ones the Sheikah had compiled, Hylians like the Sheikah can see them. Since the Sheikah don't call out anything special in the compendium, it seems safe to assume all citizens of Hyrule can see them. Blupees' origins are unknown, they glow with a mysterious blue light, they're fleeting if they're seen at all, and it's clear that weapons do not hurt them - just make them drop money. You cannot collect a Blupee, but the money they drop is real enough to use with any merchant.
Fairies
It is said in-game that Fairies can only be seen by the pure of heart. Yet culinarily, it's also said that cooking with the help of one can yield a meal that greatly replenishes health. For most people, they cannot see Fairies at all. This helps explain why trying to sell one at a shop only nets Link 2 rupees: clearly the buyer can't see Fairies, so it's as though Link has an empty palm and is asking them to trust that he's giving them a Fairy. If a small man earnestly did this to me, I might give him two dollars in real life out of pity at the very least.
Great Fairies
There's a quest where a Hylian artist wants a photo of a Great Fairy. You are only ever able to get a photo of the fountain as evidence of there being a Fairy, but it's accepted as proof enough. This means that people know where Great Fairies live, even if they've never seen one. Perhaps this is more akin to the Loch Ness Monster if you were shown a blurry photo of Lake Loch Ness? It would make sense that Great Fairies can see Fairies. It's made clear in the game that Great Fairies can see Link and other citizens of Hyrule. Based on the ingredients that they ask for, I imagine that Great Fairies can see Dragons, but we'll talk more about that later. There's no indication that Great Fairies could see Koroks. Great Fairies' powers focus around strengthening your armor in exchange for ingredients, rupees, and being accepting of an incredibly horny vibe throughout.
The Horse God
For all intents and purposes, we can generally apply what is known about Great Fairies to The Horse God. The only major difference is when you consider how this being slots into the Pantheon of Hyrule.
The Lord of the Mountain
This one shows up less often than Blupees, but the fact that you can engage in dialogue with a stable owner while riding The Lord of the Mountain, and people will duck out of the way when you ride past on it, it feels like citizens can generally see it. That being said, I may just be reading into it too much, and perhaps stable workers just assume the horse is invisible? Perhaps other citizens can hear but not see what Link is riding, but the noise is enough? I think The Lord of the Mountain can only see Blupees and other creatures (citizens, animals, and monsters). There hasn't been evidence for it being able to see Koroks or Fairies, let alone Great Fairies or Dragons.
Dragons
If I'm remembering the explanation in BotW correctly, Dragons are the immortal, physical manifestations of the spiritual forces of the triad of goddesses from the triforce (Din, Faroe, and Nayru) who exist under Goddess Hylia but above The Horse God. These Dragons can fly, can generate tremendous air currents and magical projectiles around them, change the weather, and cannot be hurt or killed. Citizens mention wanting to see Dragons, even in areas where it's easy to see them all the time. While pictures are seemingly able to capture their form, and those pictures are also present in the compendium already, it's hard to say for sure whether citizens can see the dragons in those pictures or not. There's never any quest involving you showing a picture of a dragon to another citizen and having them acknowledge your picture being of a Dragon.
My personal opinion is that the compendium may have been in part made by Link or Zelda originally, but that other members of the Sheikah cannot see the dragons, even in the photos. It would make more sense why the Dragons are revered as being holy and majestic if not everyone can see each of them every day. What's particularly interesting about these Dragons is that they have parts like scales that are with a lot of money. While Fairies being sold do not generally seem to be visible nor valuable, Dragon parts are far more valuable than Fairies to merchants. This could indicate that once a part is harvested from a Dragon, merchants can see it in a way that works differently from Fairies. Because Great Fairies mention Dragon parts specifically, I imagine them being able to see Dragons, but it's possible that Great Fairies are just like very well-traveled merchants and know of those components from previous trades.
As physical gods, I'd expect Dragons to see everything that goes on below them. That seems to be their whole reason for being.