The All-Feed is very important to increase the content-quality of the threadiverse and therefore, ensure its existense. However, for smaller instances, there is only limited reason to put the All-Feed prominent in their UI, because their posts will never be present there. However, if they push people toward their the Local-Feed (which they currently do), people will only stay on their instance and overall discussion quality declines.
So, to truly overcome instance protectionism, we need a new feed, in which an instance can find a good balance between showing content from other instances and its own.
I wasn’t aware small instances were hiding the all feed, but honestly I’m not opposed. If people want to run Lemmy instances the same way forums used to dot the internet, that’d be cool. Users having the ability to chime in with their kbin account or whatever is just a nice perk for ease of use.