I wouldn't be thrilled about being at the helm of any ship that I couldn't see out of very well. My guess is they wouldn't put a cloaking device on a ship that they didn't equip with sensors that could see out through the cloak.
Yes, during WW I and II even carrying munitions made a ship a legitimate target. The British government denied for decades but eventually admitted that the Lusitania was carrying ammunition and was therefore a target - even though she carried no guns. Treaty called for a submarine to stop a ship suspected of carrying munitions, search it, and, if it was carrying munitions, allow the civilians to disembark to a place of safety (specifically NOT on the lifeboats), and then sink the ship. A completely unworkable procedure by WW I - no U-boat captain would expose his vessel to a ship that might have big guns by surfacing. It would take hours to search a liner, during which the sub would be hugely outnumbered by the liner's passengers and crew, and the suspect ship might have been able to make a radio call to a destroyer. (Might make an interesting plot for a historical fiction novel - civilian liner captures U-boat!)
But if you look at the Lusitania from the point of view on effects on the war as a whole, legitimate target or not, deliberately sinking a liner with thousands of civilians aboard helped turn the American public against the Germans and was a major contribution to the United States' entry into the war, especially when in 1917 they started unrestricted submarine warfare again.
Are they any instances in Star Trek of a civilian ship with a cloaking device? In "Rules" it turned out not to really be a civilian ship, but on the other hand no one seemed surprised that a civilian ship might be cloaked.
Quark couldn't actually sell you a cloaking device. In "The Emperor's New Cloak," he got one by stealing it from the Rotarran. Somehow Martok did not end up putting him on trial and in prison. But if Quark made a habit of it, I'm sure he would be in prison pretty quickly. He wouldn't risk that just to put it up for sale, he stole it only because it was the Grand Nagus's ransom. As a humor episode, they ignored that any ship would be keeping watch during wartime, even in a safe port.