I think these nations setup the ISPs to look for the packets using a VPN protocol. This protocol is only used between the user and the VPN provider, so the target website doesn’t see it. Though I think this can be evaded too with a bit of work (masking the packets as normal web traffic). One reason why repressive regimes also want to control the devices of the user.
There are ways to ban them even if it evades detection though. Incompatible formatting and mobile applications come to mind. Charleston in South Carolina having the highest concentration of diehard privacy maintainers goes over nobody’s head, having it come up as one’s location is like wearing a label that says “I am not who I appear to be” and is the source of the most common geoblock in the free world. Probably a giveaway I help keep the peace in a few sites.
Isn’t that just a game of whack a mole though? Ban VPNs ending in Charleston, people hop to another location. Rinse and repeat