Bill,
No you are not missing something with the unconditioned side of the attic insulation. I missed the point of your question with the topics change from the garage to the attic area.
In my opinion the habitable attic configuration you described the code does not require the insulation exposed to the attic ventilation to be sealed. From the questions contractors have asked me and from online research some jurisdictions however do require that knee wall and the attic floor to be enclosed in an air barrier; the beats all requirement 12. Other sources of infiltration.
Going back to the ceiling/floor assembly between the dwelling/garage points of inspection does make the insulation "encapsulated" in an air barrier.
TABLE N1102.4.2 AIR BARRIER AND INSULATION INSPECTION
[TABLE=class: MsoNormalTable, width: 625, align: left]
[TR]
[TD=width: 202, bgcolor: transparent]Ceiling/attic
[/TD]
[TD=width: 601, bgcolor: transparent]Air barrier in any dropped ceiling/soffit is substantially aligned with insulation and
any gaps are sealed
[/TD]
[/TR]
[/TABLE]
[TABLE=class: MsoNormalTable, width: 625]
[TR]
[TD=width: 202, bgcolor: transparent]Floors (including above garage
and cantilevered floors)
[/TD]
[TD=width: 601, bgcolor: transparent]Insulation is installed to maintain permanent contact with underside of subfloor decking.
Air barrier is installed at any exposed edge of floor.
[/TD]
[/TR]
[/TABLE]
Francis