The linked post shows how most non-tech people’s understanding of email is very very different from most of the people here.
Unless an instance enrolls in Lemmy-federate, the default behavior is that a user, even on the /all view, will only see local communities, and outside communities that another local user has sought out and subscribed to.
If a newbie joins a small instance and doesn’t know how to seek out communities that interest them with lemmyverse.net, they would likely have a very small range of content in their feed.
Lemmy-federate helps by auto subscribing an instance to participating communities, seeding a wide range of content immediately.
A large instance would offer a good experience either way, but would encourage centralization without Lemmy-federate existing.
Why on Earth would a newbie join a small instance? How would they even find out about one?
Assuming they search Lemmy, and one of top results is the join-lemmy page (second result for me, below Lemmy.world), the server recommendation tool can suggest small instances with only a couple hundred members. For instance, if one selects Art as the topic and English as the language.