True, but the same issue happens with reddit as well, for example gaming vs games vs truegaming. Over time those communities either found their niche (gaming sub became mostly memes, games sub became news and discussions and truegaming tried to become a more serious discussing sub). Actually there were way more gaming subs but unless they found their niche they died out. So people gravitating towards specific communities is a natural occurrence.

As for trying to automatically consolidate communities across instances, it sounds like a great idea on paper but seems like technical she moderation headache, because you won't have a clear source of truth. Let's say instance A and instance B both have a community called news. The same news article with the same title is posted on both communities on both instances by different users. Assuming we want to consolidate those posts into one, which instance post will be shown or in more technical terms, which instance becomes the source of truth for that post? Who makes that decision? What if there's also instance C with the same community and the same post but that instance isn't federated with instance A, how do we consolidate posts? Each community has its own moderators and moderation rules, who is allowed to moderate the post? What if the moderation rules contradict between instances and both instances want to apply the rules independently, are they supposed to split the post?

Maybe there is an elegant solution to all the problems but I don't see there being one. I'm not against the idea, the problem is you want to solve its something I have given some thought and because of that I just don't see it working out the way you're imagining it.