I know, it might be unpopular, but consider this explanation: what if that mode was designed to be turned on when car detects running in a badly ventilated area like indoors or in a tunnel and such? Just to avoid becoming a health hazard. And nobody realized that such mode would interfere with EPA tests. And VW own testers were simply replicating EPA testing rig to insure that ther testing is the same, while having no clue how engine works. While it is still probable, that someone in VW realized that there is a problem, they kept their mouth shut for various reasons. But generally this explanation does not require any wide conspiracy or anything.