Let me be honest. I am not EXACTLY sure what the Lord meant when he described himself as “knowing good and evil.” Let me give you my best shot as to what he is talking about here. It goes back to where this knowledge came from, which is the tree of the knowledge of good and evil. What is this knowledge that Eve and Adam acquired when they ate the fruit from this tree? I believe that this was knowledge about things that God did not want them to have. It was knowledge that was not good for them. It was knowledge about things which are true, but which are not helpful to humans, as it would lead to their temptation. Let me speculate a bit. It may have been knowledge about the potential evil uses of the sexual desire. It may have been knowledge about things that humans can accomplish, but if hey accomplish them, it would lead to pride. It may have been knowledge about kinds of pleasure which can be tempting. What I am fairly confident about is that knowledge involved things which are harmful and things, which, if embraced, would be sinful. Before they ate from this tree, the only sin they could commit was the sin of rebelling and eating from the tree. After eating from the tree of the knowledge of good and evil, all kinds of potential things opened up, but many of them brought with them the temptation to pride, to selfishness, to greed, to harmful sexual activities and more. This acquisition of knowledge that God did not want them to have led to the “Fall” of mankind.
There is some evidence in the biblical text about what kind of knowledge that Adam and Eve gained when they ate from this tree. Before, they were unashamed about their nude bodies. Afterward, they were ashamed of their nudity. Their knowledge apparently had to do with potential sinful kinds of behavior. Maybe it involved giving themselves sexual pleasure, or even sinful activities with animals. I do not know for sure, but I do know that after eating this fruit, Adam and his wife knew of things that God did not want them to know about.
What is the “knowledge of good and evil?” I believe it is awareness of possibilities within the range of human activity which, if embarked upon, would be sinful. To know about evil is not to take part in evil. God certainly knows about evil. God always had this knowledge, but he never sinned. Once weak humans had this knowledge, it was only a matter of time before they sinned again. I believe that all adult humans have such knowledge.