Having grown up attending US military (base) schools in Germany, I sometimes strike up conversations with "active duty military" folks in the jetway (I board as GS right behind them).

I would estimate about 30-40% were not eligible. Some were retired or non-active reserve. And a lot have not been military at all. The last bunch I asked was a trio of guys -- out of MFR -- who said, "we're not in the military, we're in law enforcement."

Just like with the "support animals" and disabilities, there's always going to be cheaters. Unfortunately, enforcing this sort of thing is still more trouble than it's worth.