y, which is a pronoun, will there refer to a specific topic, while the second sentence is more vague.
On parle beaucoup de technologies. On n’y connaissait pas grand chose à l’époque.
In this sentence, you’re saying that, back in the time, you didn’t know much about technology, because y refers to technologies. You could replace y by ne … à celà.
On parle beaucoup de technologies. On ne connaissait pas grand chose à cela à l’époque.
For the second sentence :
On ne connaissait pas grand chose à l’époque.
There, if there is no more context, you’re simply saying :
We didn’t know much about stuff in general at that time.
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