Lemmy 0.19's instance blocking does not filter users, only communities, in addition it does not solve the problems of content polution because it does not limit interaction from blocked malicious users in any way, just hides them (it only really works under the assumption that they're not malicious users and the blocker is just throwing a fit). For these reasons it is not and cannot be seen as an a replacement to defederation.

Also as I already said users are 100% free to decide, they decide by choosing their instances. If you don't like it you're free to host your own or move to a more open protocol like Nostr. The idea of federation was built around the idea of communicating with certain instances and blocking others, not about users individually choosing the servers they connect with, Some servers do operate democratically but in the end the fediverse is designed around servers so servers have every right to choose.

Also I'd like to address the "defederation will kill the fediverse" claims I've seen floating around. It won't in fact it's a dedicated feature of activitypub and has been in use since forever, instances are able to block ones that go against their values either due to the way those instances are operated or the users they allow on them. This is how it's worked since the beginning and almost certainly how it will continue. Some users don't like this and believe that they should be able to access stuff no matter what, failing to realize that they do not own the server their account is hosted on, accessing content on other servers via activitypub requires the content be copied over to your home server, and if the admins don't want that they can block that server, you don't really have a say in it because it isn't your server. So either host your own where you do own it, or move to a more open protocol which exist for the purpose of user freedom and anti-censorship.

what bullying

Some of the time it is though. Like Gmail has a pretty large list of IPs it won't deliver email from. When self-hosting, it's something you really do have to worry about.

The reason most people don't worry about it is that most people only use a handful of free emails and organizations that provide email addresses for their users spend time worrying about it so users don't have to.