I truly try not to intrude on people and I'm very sensitive about how I act when I shoot strangers. If it's obvious someone doesn't want their photo taken, I move on without a second thought.
I think the times it might be awkward is if you're taking a photo of a stranger doing nothing that is photogenic. ie. The person is not interesting looking, or is not doing anything interesting in particular, or is not walking through a scene that could make an interesting image.
If you look for photogenic scenes (a street fair was mentioned above, or a sunset hitting the street with some interesting light for example, or say a worker carrying a large number of boxes in the middle of a busy street), you'll probably find most people are too busy to even notice you taking their photo.
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