What would be grotesquely offensive stuff to you? You realize that grotesquely offensive to very online Americans is an extremely niche thing? It makes sense to NOT want your online presence to be tied to whatever some Americans think makes perfect sense, right?
I don't think you'd agree that it would be weird to not want your social media and what you see online to be tied to what some, for example, Saudi dudes think is acceptable at the moment.
I'm not sure what you're complaining about. Don't join the Saudi instances, then? That's kind of the whole point of Mastodon, and federated services in general. There will always be instances that match whatever worldview you may have.
What you can't do, and should never expect other people to do, is to be forced to receive what you're posting, or to put it another way, you can't force people to listen to you.
In twitter, people can choose not to follow or mute you on individual basis, that's basically what “not listening” means. Banning somebody means preventing other people from listening to them, so it's not the same.
The fact is that Twitter makes you believe that you are listened to, even if you say shitty stuff.
Mastodon confronts you that if you say shitty stuff, nobody wants to listen to you.
People complaining being banned or being on defederated instances are people other don’t want to listen. They pretend to have a personal opinion while they are only assaulting others.
LGBT is a good example: you cannot have an opinion about it. Those people exist. They have the right to exist. You have the right to not engage in any LGBT activity. But you don’t have the right to talk about a "debate". There’s none. If you do, I you maintain that using "cisgender" should be a banned word, you are simply an asshole and can’t complain that people don’t want to listen to your ramblings. And yes, this will get you banned.
On Mastodon, people can choose to pick an instance that will rarely defederate anyone and follow or mute on an individual basis, or they can choose an instance where moderators will take a firmer line.
The trouble is how to judge them. Automated censorship of others is invisible unless they announce it or you somehow know what you should have been able to see.
Mastodon instances tend to have admins who are if anything pretty loud and argumentative about what their mod policies are. If that matters to you, you can easily find instances that make a point of being open about what they block. A whole lot of people don't care about the how or why as long as they're not subjected to content they don't want to see, and that's their choice.
If you choose to only talk to like-minded people, that is your right, as it should be. And might well be one of the reasons most people aren't on Twitter, and many who are subscribe to extensive block lists.
You know, just like in real life.
There are plenty of instances that allow abhorrent content, if that's what you want, but you can't force others to receive it.