> sounds like people you probably don't want to interact with anyways?
That's all well and good when it's a single user instance or small group of friends. But often enough it will be a much larger one with unknowing participants caught up in it. Blaming them for choosing the "wrong" instance is about as productive as blaming people for using facebook - technically correct but that's about it.
That said, the AP model seems like the least worst to me. Every option I'm aware of has significant downsides.
The problem is when this is a large server with people you know using it. They suddenly disappear from your feed. And those people may not have even agreed with the reason for defederation.
At that point, the only way to connect with your friend(s) is for you or them to find new servers that haven't (yet) gotten into a defederation slap fight.
The TL;DR of the problem with Mastodon is that you basically need to pin your identity to what is essentially a small internet community/forum and then give them full power to decide who/what you can consume while your identity is tagged to their community.
Again, go check #FediBlock. If you'd like a specific example of the single issue vs multiple issues, pay specific attention to trans vs black conflict there and see how it is played by both sides.