Ignore hides only the content of posts, not the existence of a post, by an ignored user, so you will indeed see a brief informational message notifying you that there is blocked content missing from the thread you are viewing if you choose to ignore a member. This is normal for vBulletin sites, the only configuration choice available as an admin is whether or not the "ignore user" functionality is enabled or disabled, there are no other settings associated with the feature. It is not meant to be, nor implemented as, a total invisibility cloak.