That depends entirely on how exactly you do it. And knowing something and being able to prove it are two very different things.
You're creating a situation where you have a set of encrypted and non-encrypted devices that are indistinguishable, and expecting the police to let you off. But there's nothing stopping someone with only encrypted devices to claim the same thing. I'd be worried that approach would fail either by 1) the police calling your bluff, or 2) indefinitely holding you in jail for contempt of court until you decrypt a drive that has un-decryptable random data.
Encryption with plausible deniability will not have readable headers. It will appear to be completely random data.
"Don't worry about my large collection of seemingly encrypted USB sticks officer, it's actually just random noise I filled them with for the lulz! No sensitive files here."
I see no flaws with this plan.
Usually when you encrypt a drive there's a telltale header, so the disks wouldn't be "seemingly encrypted" at all — and wiping disks clean with noise isn't especially uncommon. It's as plausibly-deniable as it gets, and it'd certainly fly in court.
Not necessarily.
https://www.truecrypt71a.com/documentation/plausible-deniabi...
2. Until decrypted, a TrueCrypt partition/device appears to consist of nothing more than random data (it does not contain any kind of “signature”).
Better just to buy a bunch of USB sticks, wipe 'em all with random noise, use a couple for mundane files, and use a couple for sensitive files — deniably encrypted so as to look like random noise. Then, you can plausibly deny that they contain any sensitive files.
The real issue here is that we shouldn't need to use these sorts of measures. No one will do this unless they're a software professional with something to hide, and "having nothing to hide" doesn't mean you're not still entitled to privacy.