I'll wave when I see one of the many stock Defenders driving around town and I'll usually get a wave back. Unfortunately no one brings their rig off road - would be cool to have some wheelin' friends right in town.
If I see a RRC or modded Disco I'll throw a wave up same with a modded Jeep or any modded 4x4. And if people wave, I'll wave back - in the summer with the top off, people can see you a mile away, so it's easier just to wave back as it'll probably be someone I know.
There is a beautifully modded Jeep TJ a couple of streets away and I've been waving to him but nothing back. Not sure if he even brings the vehicle off road as I've never seen it dirty in the 2-3 years I've known about it. But if I had a Jeep, I'd set it up just like he has.