So you didn’t get the choice at all? I guess people who sign up this way are going to be really confused why they can’t follow some accounts their friends can.
The official Mastodon app has a box where you can pick one out of several hard-coded instances. It defaults to mastodon.social. You can pick a different instance if you want to. But you can also ignore it, scroll past it and let yourself be conveniently railroaded to mastodon.social without even knowing what an instance is.
You are misrepresenting it. You would still run into this issue. Moderation being separate doesn't mean it doesn't exist. You will still not be able to follow someone your friends follow because your moderation service banned then.
If you've never in your live chosen anything that has to do with IT, if all you know is centralised, monolithic silos, then you can't be expected to first choose one out of literal dozens of microblogging projects in the Fediverse and then one out of dozens, hundreds or thousands of instances.
The Fediverse would be a whole lot smaller if not all newbies who didn't come from Reddit were railroaded hard to mastodon.social. Oh, and Lemmy would be a whole lot smaller without Redditors having been railroaded first to lemmy.ml and now to lemmy.world.