You are obviously speaking from the privilege of someone not only familiar with how lemmy works, and who understands the difference and pros/cons of joining a large vs small instance and can probably even name a bunch, but also someone who knows of obscure tools and github repos that host those tools. What prevents users from switching using that obscure tool you referenced is that most users never heard of it and didn't know it even existed. You are using the argument that new and casual users should have god-level knowledge and understanding...which is exactly the point I'm trying to argue against. Casual and new users don't know what they don't know. They don't know what other communities are out there and they don't know that when they view "all" that they aren't seeing them. Think about this from the perspective of someone who doesn't know what you know.

Regarding your argument about NSFW and foreign language search results....that already happens now when users of your instance have subscribed to those things. You can't argue that it would become a problem when it's already happening right now. If it really was the problem that you think it is, then the solution would be to mimic what every other search tool figured out three decades ago and put an option to exclude nsfw results when viewing/searching "all" communities. It's already possible for communities to flag themselves as NSFW, and it's already possible for communities to designate their community language setting, it would make sense that those options be presented to users for filtering. These filtering options are things we need now regardless of whether search results come from actual-all or subset-all. I'm just suggesting that "all" mean "actual all".

But, just for fun, let's steelman your claim that it would be technologically infeasible for "all" to be "all fediverse" as opposed to a subset of just what this server's users subscribe to (it's absolutely not technologically infeasible, but lets pretend it is) - even it that scenario, they should at least change up the UI for the communities page to make it clear that when the user selects "all" that they aren't really getting all - it should be made clear what the user is actually getting, which is "local, plus foreign content that is subscribed to locally". It simply is not truly "all", so presenting it as "all" is only leading to more confusion about what the users are seeing.