I recently watched a very interesting video that Google made about what people think a browser is. The general sense you get from the video is that people generally have no idea. See the video here: (Don’t worry its short enough to watch)
I also read a really interesting post by my friend Feross (read here) where he talks about technology making things so easy that people no longer have the vocabulary to fix their problems. It’s a very interesting idea, especially as the web becomes more and more powerful. I’m not sure if the sample in the video is representative of the country or the general web community, but it is very intriguing that much of the web and much of technology is used without any knowledge of what is going on behind the scenes.