Having had three boys and been a Webelos den mother for three years, I can tell you that *all* 9-10 year old boys think they know everything. "I know" is the standard response, even when they clearly don't and/or couldn't have known. "We're going to start work on the new X badge today." "I know."
I can tell you that they do outgrow it, eventually. (With twelve-year-olds, the verbal tic is "Guess how awesome I am!")
It is more complicated with gifted kids who really do know more than the average 4th grader. I think starting a new activity with "What do you already know about this?" and proceeding from there is good for gifted kids. When I teach Junior Great Books, we're supposed to only ask questions that we as adults don't know the answer to. It helps to keep from steering the conversation to a foregone conclusion (which is what many classroom conversations are). Ask "Why?" and "How?" questions more often than the who/what/where variety. That way your son has to use all his prior knowledge and reasoning skills to answer the question. Making up facts can be fun (try the game Balderdash!), but they don't answer non-fact-based questions.
Also, if you're trying to teach him something (say, sewing for example) and he claims he already knows how to do something, ask him to show you. He may have actually figured out how to do smocking or hemming or something. And his way may work or it may not, but there's nothing hurt by trying it his way first.
I have a son who always thinks his way is best. He's particularly good at math and frequently has figured out his own ways to do the math problems. If his way always works, I let him do it his way. If it only works on some of the problems, some of the time, he needs to learn both ways to do the problem. We also try to analyze his method vs. the approved method to find out why one works all the time and his "easier" method is less reliable.
There's nothing wrong with telling him, "No, you don't" when he says he knows something. But if he does know it and you just teach it to him anyway, he may lose faith in your reliability. Let him try things his way first and eventually, he'll come to realize that you both value his intelligence and creativity and that it's okay for him to be wrong, which is a very important lesson, particularly for gifted kids.