To be fair I do not expect any privacy protections from lemmy/mastodon in general, or from blocking/defederation in particular.

Lemmy/Mastodon protocols are not really private, as soon you place your data in one instance your data is accessible by others in the same instance. If that instance is federated this extends to other instances too. In other words the system can be seen as mostly public data since most instances are public.

The purpose of blocking or defederation (which is blocking at instance level) is to fight spam content, not to provide privacy.

This isn't how any of this works at all. Defederation does not increase your privacy from them. That's not how federation works. They still will see your posts. Blocked or defederated. You just won't see theirs. Blocked means you filter out their content. But they could theoretically show up in comments. Defederated means it won't populate. But it doesn't mean your content won't get populated there. They simply can't comment on content from or direct message folks on a server that defederated them.

Privacy through obscurity is as bad as security through obscurity.

Any real danger Meta presents is looming regardless of federation. I'm not against defederation. I'm just against defederating without purpose. And to be honest, what I've heard so far leads me to believe defederation will be my likely call if and when Threads goes live with ActivityPub (well, defederate with their primary instances at least, not sure of the details of how one can defederate with every Threads based instance, though it may be simple). But I don't even know if they'll federate with Lemmy/Kbin to begin with and I do not want to start some trend of instances needing to act on hypotheticals.

Tl;Dr - defederation does not increase your privacy at all. Not saying you shouldn't defederate for other reasons, but your exposure is absolutely unchanged one way or the other. This article has federation entirely wrong.

The case with Matisse is absolutely horrifying.

Lemmy isnt't meant to be private, it's a public forum. One should fully expect everything one posts to be seen by anyone. Assume Meta is using all your Lemmy posts to try and build a profile on you - be careful how much personal info you post.