Decentralization should be a background thing with hosts providing server space like you would get from a service like AWS and the front end being a single website with users not knowing on which server their content is hosted and backed up.

You could potentially run into issues with data storage reliability:

• What happens if some server hoster were to simply delete their hosted data? Would the data simply just cease to exist? You would end up needing to duplicate it some amount of times to statistically ensure some level of security in the data, and, even then, it's not a guarantee.
• How do you ensure that the data doesn't get tampered with when it is stored on other people's untrusted servers? You would need some way to digitally sign data with a user key, which carries with it many potential catches.
• You would need to make sure that the data, and networking needs, are distributed according to what the server is able to provide.

I understand that these things could still happen, to a similar extent, with the current model of Lemmy, but they are less likely to occur, given that you can choose which instance to join. These are all not unsolvable issues, but this is not a simple "better" alternative — it's more complicated than that.

All this being said, there is a service that I have heard a little bit about that is sort of similiar to what you appear to be looking for called Nostr.