noKYC means you're obtaining bitcoin without having to provide personal information with a regulated entity bound by law to collect and store it as part of their business model.

Could a peer get 'audited'? Yes, but you can trade in methods that make such an audit fruitless (eg cash).

The difference is that it's unlikely vs any KYC exchange that you know will get audited and oftentimes share this information with non government organizations like chain spy firms.