Some (most probably) definitely know they are lying, but I don't believe all do. I've seen people that I am pretty certain lie to themselves. People, whose jobs and position depend on believing the lie, frequently lie to themselves because they don't want to admit that they are cheating/harming in order to help themselves. Doctors and researchers are perfect examples. They should know, but their views of themselves depend on not seeing things. Some know and choose to do the wrong thing for their own personal good, but some lie to themselves that they are doing good when they know enough that they should realize they are doing harm.