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It's all signal-to-noise ratio (SNR).
During the day, non-absorbed sunlight transmitted through our atmosphere makes the sky appear blue. There is also lots of light scattering, which makes the whole sky optically bright (in space, without atmosphere, the 'sky' is black, even when looking near the sun).
If the atmospheric brightness ( = 'noise') during the day exceeds the optical magnitude ( = 'signal') of the star/planet/UFO, you can't see them.
Being down a well would have the same effect as looking up through PVC piping - nix (Sorry, Pluto!) - it doesn't change the SNR.
Dean
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