See discussion: https://redhat-internal.slack.com/archives/CGYQL9XPG/p1725029346445219.
The secret is a relic in 1.33.0+ and should be removed as it causes an error log message to be printed in the controller's logs. The error is printed as there is a new logic in 1.33.x that although reconciles that secret (due to the label key) but it does not recognize it's label value.
Compare https://github.com/openshift-knative/serving/blob/release-v1.11/vendor/knative.dev/networking/pkg/certificates/reconciler/certificates.go#L108-L119
with https://github.com/openshift-knative/serving/blob/release-v1.12/vendor/knative.dev/networking/pkg/certificates/reconciler/certificates.go#L103-L112

This can be deleted as the internal encryption feature is being re-implemented in 1.34 (will be TP). This secret was removed long ago as it was not being used back then: https://github.com/knative/serving/pull/14394#issue-1900846750.