You just have to choose the right instance. Federation does address those problems.
Right now our options remain limited because its still early days and the platform isn’t large enough yet. But in the long run, whichever servers do a good job of limiting extremism without being overly authoritarian in moderation will continue to thrive and grow, and servers where the admins are petty and/or politically biased will slowly die.
If you ran afoul of a moderator, sure, you could create another subreddit with a name like r/xyz_2 or r/xyzAnarchy. But it would only ever be an alternative, it could never replace the original community, partially because the name was already reserved.
More importantly, if you ran afoul if an admin, there was nowhere to go. The reddit admins exercise absolute control over the content that is allowed on that site. On Lemmy, people will just leave the server if the admins pull a spez.