What I realized was I should have been asking: Do I care about the federated timeline? Do I care if my host blocks other hosts at random? Do I care if my host allows certain things (I.e. pornography with or without a NSFW tag, or at all). Do I know who the host is and can I trust them with my private messages and to not randomly ban me?
I personally like seeing the federated timeline as I have discovered some accounts through it. But my host absolutely needs to do some filtering because some hosts will allow -anything-. I never really found much use for the local timeline.
So for me, hosting was clearly the best option. I do try to get my friends to consider joining the fediverse, and I offer hosting to them to solve this issue.