To paraphrase a Yoshinken Sensei (apologies I forget his name)
A martial artist goes through 3 stages:
1. "I wonder if I could beat him in a fight"
2. "What would I do if he attacked with a particular technique"
3. "Give it your best shot."
So my advice is, if you're confident enough in your training acknowledge them in a friendly manner, but be prepared to choose your battle and keep an eye on possible escape routes!