The question about how to respond is if you want to start a conversation. You said that, generally, it's not something you would be talking to a stranger about and I tend to agree. But it's your response that makes it a conversation rather than just a response acknowledging the fact that the person acknowledged you.
Although it's not entirely useless. Certainly, if it's something within the power of the person you are speaking to to correct, feel free to bring it up.