Case in point, if tech savvy users struggle; then imagine how bad it would be for the typical person who would just probably give up after their first app.
Seems good so far.
My only concern is that the general infrastructure isn't 100% there when it comes to user friendliness/app support.
When I first tried Lemmy a few weeks ago, it was on mobile, and my only choice at the time was Jerboa (when it came to app options).
It felt pretty incomplete, and the user journey wasn't 100% clear (and heck, I'm a programmer myself). The login drop-down was hard to find, and user was expected to register manually on one of the instances. To anyone else, that would have been very unclear.
We do have alternatives now, like Connect for Lemmy (which seems good so far); and the likes. Connect in particular actually links to registration page and has some of the popular instances available for quick select out the box. That said, there is still more to be desired in terms of user journey. I feel like the community could do some work with improving that 'out-of-the-box' experience.
Federated approach is good, just gotta make sure there's no monopolies; so instances can keep each other in check.
I can't comment on the 'device limit' as I don't remember being a thing, but I was at an ASK4 affiliated living quarter 5 years ago or so.
Back then I was able to plug in my router just fine. I disabled WiFi on it since I didn't need it and used it as a regular switch just fine.