Difference 2 is it’s not really powermodding. At least not from the way I personally understand powermodding. Imo powermodding is when a mod decides to get rid of content they personally just don’t like.

In this case they got rid of a big risk to the instance itself, because, if someone decided to upload pirated content on here it would get federated to all instances that haven’t blocked the one initially distributing such content. Like another user said on this topic, this could be compared to torrenting, only without the direct P2P distribution. The risk of course falls on the people hosting the instances.

Since they host these instances pretty much for free aside of donations, that are not a requirement, and the fact that, like nanometer said, you can just choose not to be part of the instance (and register to another instance), I wouldn’t put blame on the admins of lemmy.world in this case.