Look at Reddit: it's gone bad, and yet millions still use the site.
Because they are trapped there. A user account on Reddit remains on Reddit, it can't access communities outside of Reddit.
If Reddit were magically part of the Fediverse then I, [email protected], could have been posting on [email protected]. Then when Reddit goes bad and [email protected] starts sucking, I can just start posting on [email protected] instead. No need to create a new account or "migrate" anywhere. The friction is minimal.
Since Reddit is not part of the Fediverse, then the only way I could be posting to [email protected] would be if I was using the account [email protected] and if Reddit goes bad then [email protected] cannot interact with [email protected]. [email protected] is "trapped" there, and I would have to create a whole new account to get off it (as I did).
so if a community becomes "bad" enough to make me move to a different instance
You don't need to move to a different instance. I'm not sure where this miscommunication is coming from. You can continue using [email protected] if [email protected] "goes bad" and instead go hang out on some other startrek community without having to create a new account.
Do I have to put up with a bad site as long as everyone else puts up with it, too? Or do I have to move to a smaller community on a different instance just so I don't have to deal with the problems of the original instance?
Move to the smaller instance. Everyone else can move too. It's just as easy for them as for you. Then it becomes the bigger instance.
If it's "bad enough" for you to move but not for them to move, perhaps you're being more sensitive to the badness than everyone else is. Maybe it's not so bad. If it is that bad, then why aren't they moving?