Learn@UW/D2L - Cannot Hide Individual Grade Items Used by Calculated Grade Items
If a Calculated grade item visible to students is based on grade items that are hidden from student viewing, a student can still view the grades for the hidden grade items.
Students in the course can view the Calculated grade item in the Grades tool and click the 'calculator' icon for the item. This displays the points or weights values (depending upon the grading system) for all component grade items, whether they are set to be displayed to or hidden from students.
This is a known issue.
If you want your gradebook to contain grade items corresponding to averages of other grade items you want hidden from student view, hide any Calculated grade items that include hidden grade items or use Formula instead of Calculated grade items.