Blocking shitty instances is great. Users should have more ability to include the instances they want to hang out with, in their own experience, but I'll almost never object to a "fuck Nazis" policy.
Blocking other instances that don't block shitty-enough instances makes sense. Hexbear is a chan board for tankies, but then .ml is only "more serious" by having mods snip and tut at anyone besides those tankies. If there's any actual Nazi instances, I don't wanna know, and I don't wanna see anybody that hangs out with them.
Blocking instances based on M'Zuck's embrace-extend-extinguish plans, yeah okay sure? That's predicting existential problems for federation as a concept.
But a list of instances... not even mentioning them... by association? That feels kinda skeezy.
I guess if it's specifically a "where you should sign up" list, versus a "here's all the servers that aren't fucking Nazis," then... okay. But if this is a solution, maybe we have deeper problems.