2/5 -- Hexbear is a successful Lemmy instance
I support your account of Hexbear's predecessor. I don't share your background and naturally had a different experience. I think its useful to explain the history here for the benefit of other readers to better understand Hexbear's current contrarian character, even if it is filtered through my limited experience.
Hexbear has its origins in the subreddit ChapoTrapHouse (CTH), a community that began its existence when Reddit was an open platform for fascist propaganda. Several subreddits were dedicated to mocking black people, spreading jewish conspiracies, bullying fat people, othering queer people, and sexually harassing women. My interaction with CTH was limited as a Redditor, but their participation as an antifascist group who were fighting back against those trends was a welcome presence. When the mainstream media started making a story about the racism, homophobia, antisemitism, misogyny, and the bad press threatened advertising revenue, Reddit banned the most overtly embarrasing subreddits. In an act of 'enlightened' centrism, Reddit banned CTH along with them. Perhaps Reddit blamed them for drawing the press' attention, perhaps they didn't want to be accused of being left-wing by going after fascists exclusively. But in any case, CTH needed a new address. That's how Hexbear became one of the earliest Lemmy instances.
With several years to grow from a Reddit refuge to a full-blown social platform Hexbear has found its audience. They have site-wide movie nights where films are free-streamed and co-watched in chat. They've developed an internal stalinist-emoji based language (incidentally famous for causing problems because federated sites display the images at full resolution.) They have very active moderation, responding swiftly to non-party users stepping out of line with permabans. Dying communities like !anarchism are kept on life support with activity like mods creating regular general megathreads there where the community topic is irrelevant. If you're transgender or non-binary and are looking to connect with others over North Korea apologia, there's not a better place on the web to be.
While Hexbear is more eager to federate with others than others are with Hexbear, its size and activity proves an often overlooked point: Hexbear has become extremely successful Lemmy instance in spite of (or perhaps due to) having extremely limited federation.
3/5 -- Moderation, not Federation, is the Threadiverse's killer feature
Lemmy is not Reddit, and calling Lemmy a Federated or Open-Source version of its inspiration is doing it a disservice. Since Lemmy instances are not venture capital funded, continual growth is not the criteria for success. On Reddit, people who read, post, comment, and vote are the product, advertisers are the customers, and investors set the policy. Return on investment trumps all other concerns, and Reddit must continue to grow to be successful. Lemmy allows for a much more diverse set of definitions of success.
So the 0th step in becoming a successful Lemmy instance is deciding what that success looks like. That's obviously up to the admin(s), but it can't be achieved without skilled and dedicated moderators. Moderators do obvious tasks like remove spam and ban hate-speech, but they also encourage community activities, model conflict resolution, and produce content. A healthy community is a well-kept garden, and a successful Lemmy instance must include a collection of healthy communities. Moderators are the gardeners that help a community grow.
Moderation is a difficult and emotionally taxing job. I've alluded earlier that Reddit made an unforced error, degrading the moderator experience by killing 3rd party apps, and that Lemmy is missing those same essential tools due to its current stage of development. But Lemmy has an advantage over Reddit in there are plenty of instances where admins will listen to and respect their moderators. Lemmy's codebase and 3rd party software is improving, and while Reddit may be able to improve their internal moderator support mechanisms, moderators will never be more than exploited rubes for them.
Since moderation is so difficult to do well, and is so essential to the Threadiverse project, the effect on moderators should be the primary concern in making any decision that changes the policy, culture, or performance of a Lemmy instance.