There has recently been a lot of debate on defederation as a tool. In particular, around exploding-heads and lemmygrad. I am somewhat in favour, but I do understand the concerns of fragmentation (I'm not going to entertain the "free speech" people).
I think most people on here - or at least the active commenters, which is a biased sample - don't like the general type of content on those instances and the communities they generate. This means, for instance, most of us probably don't want them appearing in the local and federated feeds.
However, the proposal for users to have to manually block those instances isn't really enough, because it means we all have to do this manually even if most of the instance doesn't want to propagate and elevate the content from these other instances.
What I think would be best is if/when Lemmy improves moderation tools ^.^. In particular, I'd suggest that we should push lemmy or actively develop into lemmy (its open source after all) some way to stop either specific communities or posts from entire instances from appearing in the main feeds, while they are still accessible if specifically linked to or searched for - "silencing". One step above per-user blocking of instances, but still below defederation.
We could also say "members from this instance can comment but not post" or other things to reduce the risk of hostile brigading and organising on this instance while not directly hindering interoperability ^.^
We don't yet have the ability to block entire instances as users, as far as I know. All we can do is ask the admins to defederate. It sounds like there is a lot of interest in adding this feature, though.
If we could block entire instances at the user level, how much need would there be for the feature you suggested? As far as I know, there are only a small handful of instances that are seen as objectionable, so it seems like a small task to block them at the user level (if/when we are able to).
Admin level blocking will always have to be a thing purely to keep content illegal in the admins' and hoster's jurisdictions out of the caches of the instance.
Several third party Lemmy apps have instance blocking features. Connect does, and I think Sync does too. I've blocked two or three instances.