The federation was always meant to build communities around shared interests and values.
If I wanted the twitter "experience" I would just use twitter.
If I wanted a "free for all" environment I would be on 4chan.
I was trying to understand how it work in practice. It would be relevant to picking which instance to use.
Or will associating with one likely get my instance blocked from federating with the other?
Yes. Some are over things that should be relatively uncontroversial, like loli-hosting instances. Others are more likely to garner upset on HN.
The same thing has happened in the free software movement in general; some folks have called for copyleft-only, and the rest of the world has largely ignored them and is fine with shipping BSD licensed software along with GPL licensed software.
In reality biggest servers still federate with most servers. With latest changes in Mastodon you can now see whom they don't federate. It's not huge list, and if you browse those who don't federate with, it's pretty obvious why.
A lot of those defederated services advertises themselves as some sort of free-speech absolutist alternatives.