K&T wiring has been long deprecated. I suspect that there was a neon bulb across the switch contacts, so when the light was off, the neon lit. When the light wa

K&T wiring has been long deprecated. I suspect that there was a neon bulb across the switch contacts, so when the light was off, the neon lit. When the light was on the neon would go out. When you say "pilot light", I presume it's a tiny incandescent bulb, or a LED with a dropping resistor. In both those cases you will need neutral for the light to be on. AFAIK national electrical code now requires neutral wire at the switch.