The Iron are rooted to the foot of League One thanks to the 4-0 home drubbing by the Glovers on Saturday, and while they were beaten 2-1 by the Canaries there was at least some pride restored.
"It was important the players gave a decent account of themselves and the team gave a good account of itself and I thought we did that," said Knill.
"We came off a really poor result on Saturday and you are playing against a Premier League team and we just looked at their team when it came out and thought 'that team could easily win the Championship'."
Knill also felt his side could have claimed a notable scalp if they had managed to take an early lead through winger Andy Barcham, who saw his third-minute effort well saved by Declan Rudd.
"That was the one, wasn't it. We had a great chance then they go up the other end and have a lot of possession," he said.
"Then they score on 30 minutes and you go 'here we go' but it was a good time to score the equaliser and I thought we were in the game.
"Obviously we are all disappointed we lost because we had chances and I thought it was a good game of football - two teams trying to play the right way and I thought we came out of it with a lot of credit."
Chris Hughton, the Norwich boss, felt the Iron had held their own against a team two divisions higher.
"Scunthorpe are having a difficult time in the league and this would have been a really nice release for them I think," he said.
"I thought they played quite well and made it difficult for us. We could have made life a little more comfortable for ourselves by getting the extra goal, but I thought as a team I couldn't fault the effort of the players."
Hughton made a number of changes to his team, naming a side many would consider second string. He insisted that was not the case.
"I'm pleased for the players that played because there is a bit of a pressure on them, I have changed the team but what I was desperate for it not to feel like was that it was a second XI I had put out, because I didn't see it that way," he said.
"I'm happy because we made the decision to change the whole team, which we were able to do because of the players we have. hat is how it should be - that whoever plays in the game is doing well enough that they are giving me food for thought and I thought there were some good performances."