As you say OP, the solution here is to use the fediverse model as intended and use different instances/communities. It sucks because it fragments the community, but that’s the way it is. I’ve long held the opinion that I’m grateful to the lemmy developers for building this whole thing that we all get to enjoy, but their approach to administering an instance is reprehensible and actively damaging to the relatively free and open exchange of ideas that should happen on the fediverse.
I don’t agree with the “hiding the problem” notion because different instances are independently operated, and defederation is the by-design way to “fix” malignant instances (see the LW defed of hexbear and lemmygrad for exactly this kind of behavior).
As for the whole system not being safe, I’d also disagree on that point as the entire lemmy server code is licensed under a copyleft license which allows anyone with a copy of the code to modify and distribute it. Ergo, hard forking lemmy is possible. Based on the github page, over 800 individuals already have forks of the server code. Any one of them, group of them, or some other individuals entirely, could pick up lemmy development and run with it if need be.