I think the big problem was that they were one of the initial, fairly open, popular instances. And only after they gained popularity did they decide to shut and barricade their doors. It feels kind of bad to have been participating in there and then to suddenly effectively "banned" from participating in some of the (at the time) most popular communities.
If they had initially began with their walled garden intent (like Tildes has done), it would be less jarring. As it stands, it's a bit like having the rug suddenly pulled out from under you. Leaves a bad taste in my mouth and I don't necessarily appreciate the way the admins over there are handling things. It should have just been that way from the beginning and I wouldn't have had a problem with it.