[Anaraxes]

I'd think Observation also covers the times you're not hidden, as Rocket Man describes. You know tactics to keep out of sight while Observing in the first place -- but when you're not out of sight, you also know how to Observe without obviously focusing and staring at your target of interest, taking notes in your little notepad, glancing at your watch every time security guard walks by, and all that, when you "case the joint".

Acting skill alone means you fool people into thinking you're just another shopper/tourist/cubicle dweller, but you won't learn anything just by hanging around and Acting. Observation lets gather information while you avoid attention-getting, out-of-character actions that would blow your Acting role and roll, much as it lets you not do stupid things to obviate your Stealth/Camo roll.