Hi Nahvi.
Thanks for posting this well put together post. I can tell that you put some time and thought into this and I want you to know that I recognize that.
Regarding your concern, this is a topic that has been brought up numerous times over the past month. I've since moved towards being more community driven, letting users discuss and debate on topics that are important to them. These discussion move forward towards a vote over a 7 day period. This process will change over time as we come across flaws and look for ways solve them together.
One more thing I want to make clear regarding your tl;dr question Will I be blocking other instances for personal reasons? Short answer is no, I believe the community should determine what should or should not be blocked.
That being said I want to make myself clear that there are limitations, I will continue to defederate instances that openly promote or spreads hate speech, terrorism, CP, loli, trolling and instances that become bot instances. These shouldn't be things that need to be justified, I think they fall under the "be a good human" category.
I hope this clarifies your concerns and you continue to make sh.itjust.works your home.