Instances aren't really blocking others, they're defederating. That means not communicating with certain url's. That's something you can accomplish on a system level, even if the "feature" isn't in the application you are running. (lemmy/kbin)
The devs didn't "give" this ability to instance admins, it was always there.
As for users being able to block instances, I agree. It should be a feature. For now, you can still get there the long way round, by blocking every community on a given instance.
But the vitriol in your wording is entirely unwarranted.