The simplest answer is that the octopus will be discovered in day-to-day life.
Lets say your human always sleeps late, but one night your human wakes up because he's got the flu and can't sleep, but the octopus in question is still asleep somewhere unable to mindcontrol himself away. That's going to be a discovery right there.
Lets say your human hits puberty and is goofing around, playing sports or similar. During this there is a fair chance the octopus gets hurt enough that he can't fulfill his obfuscation act anymore. Similarly during accidents the octopus can be discovered.
If the octopus gets sick he could also be discovered, worse if the octopus gets fever dreams and mentally lashes out at nearby humans. You could also have dumb octopi or octopi with disabilities, or even just "plain" depression that aren't able to keep the ruse up.
Then there's designing the world. If you put on a hood because it rains the octopus needs to obfuscate the fact that he's on your head and the hood doesn't fit. You could argue that the octopus could hide on the shoulder instead, but exposure to the elements is a solid way to die for such a creature. It doesn't matter if its heat, cold, sun exposure etc, if the octopus is more vulnerable he'll be disabled much quicker. A way around this is to design the hood to accomodate the octopus. Unfortunately you are now looking at the task of every octopus that witnesses anything being designed in the world to accomodate for a wide variety of situations for the octopus. How do you deploy an airbag in a car and still protect the octopus properly? How do you deal with the overload of opening a clothing closet filled with modified hoodies and the octopus having to erase every idea that they are modified hoodies? How do you make sure every roof of every vehicle and room is high enough to accomodate the octopus?