it’s kinda vaguely similar though… a fediverse instance is moderated by the instance admins, just like a discord server (though discord has a level of admin above server mod/admin i’m not sure that distinction matters for the general user)

It's arguably used wrongly on Discord, but not in a way that's radically different from how I already thought about "servers" in the sense of "something you connect to".

It seems more like a term they picked because it has that familiar sense. Otherwise I think there's a semi-official term, "guild", too.

For me:

• Instance = MMO bosses. Part of the server, but doing your own thing, seperate from the rest of the server.
• Server = a large number of people that can interact and talk with each other.

But also me:

• Server/Instance = An individual connection point to the whole (Lemmy in this case), with it's own rules/policies, but can interact with the whole unless they become unstable/spammy, at which point they are removed (Lemmy = defederated).
• Lemmy = The IRC network. You can have netsplits (different instances coming and going that effect each other), but they all talk the same language and really for the most part doesn't matter what server your on.

Discord = I do not understand. It's like if you mashed IM and IRC together, but broken, and doing nothing well. Why anyone uses it is perplexing.