No no, nothing happened. It was all angry discussion by crowds who didn't know anything. The problems were solved very fast and no one ended up unhappy except for the troll.

If I'm actively subscribed do I still get the content [...]?

No, the whole point of defed is that your home instance stops "listening" to the updates of the defederated instance. So you'd stop getting updates from any community hosted on @sh.itjust.works period.

I think beehaw is the only major group that actually defederated us, but that was before the drama

If this defederation thing takes hold on the Lemmy network like it did the activitypub network then there's no point in switching to this from Reddit, and it'll just become small unconnected forums anyway.

Now you only see the “local” copy of those subs. People in your instance can post links to it but you won’t see anything other non federated instances.