This looks like heavy damage from rose slug sawfly larvae. It is a very common problem in roses, including the Knock-outs. To control heavy infestations, use horticultural oil or spray with spinosad insecticide. Read and follow the label instructions when you use these products. Target the undersides of the leaves to get good coverage. Here is additional information about rose slugs and how to manage them: https://extension.umd.edu/hgic/rose-slugs-shrubs
We do not see any symptoms of rose rosette virus.