I don't know much about programming, but understand something is either there or not. There's no subtleties like implications. Something about being binary. Now if you're saying the AI will in fact know the DoW is a result of the theft, then great. However I don't think that's it.
As I imagine it, the current button is more of a contextual thing than anything. If you're ahead, feel free to press it and rattle your sword. If you're behind? beg to your betters, and maybe they'll show you mercy.
You kinda have to use your imagination on this. It does have some effect on the AI, since they'll actually do it alot of the times, but only after you tell them to, similar to the don't settle cities request/demand. It all depends on who you are, who they are, and what the circumstances of the game are. Could it use more depth to it? Certainly. But is that really the top priority for the current diplomatic system? No, nor should it be.
I think my point this entire time has been that you're complaining about something unbelievably niche and sort of irrelevant. If they steal a ton and piss you off, burn their capital to the ground, otherwise suck it up. Push the button if it gets annoying, and if they blow you off, nuke them. The computer is ground entirely in programmed AI logic, you, as the player, are not.
And just for clarification, when's the last time in human history powerful kingdoms went to war over technology being stolen? I'm not even sure such a button is even worth implementing, especially since you can't even trade techs, so it's not as if there's a peaceful, legitimate way to acquire another civs tech.