Just curious, how can the se's decipher if the text is hidden or its just regular site content? Can it tell the colors are the same?
Yes, if the colour of text is set to the same colour as the background it would be easy to spot. It can also don'e with CSS which would be harder, biut then people can still manually report you.
Like I originally posted, I have no intentions whosoever to use this tactic, I was just curious. I hope that was clear.
Correct. Spiders just read HTML. The colour isn't relevant. They'll see it for what it is - keyword stuffing.