First, just because reddit fucked it up doesn't mean that's the only path forward.
Second, if the Fediverse community doesn't address advertising, somebody will. Probably somebody with deep pockets, and it won't be in the way anyone other than the advertisers wants it. Sure you can defederate them, but that's most likely going to result in a fragmented Fediverse with 95% of the users in a corporate walled-garden and 5% of users in a free (however you want to define "free) but content-poor open world.
I'm not suggesting that advertising should be pushed between instances. Quite the opposite: advertising (if allowed) would be up to the individual instance to decide if, when and how users of that instance (i.e. those that are browsing that instance using that instance's UI/application/website) would see advertising. Don't like ads? Sign up with a different instance. The API I've suggested is not for publishing ads. It's purely informational to enforce transparency about how/where the funds to run an instance come from, and, if you so desire, tell you the official way to directly provide financial support. That information could also be used when subscribing across instances, to warn of potential bias, or about their advertising policies if you decide to visit directly. I'm basically suggesting a way to encode the suggestions in https://www.eff.org/deeplinks/2022/11/fediverse-could-be-awesome-if-we-dont-screw-it, point #6 in a machine-readable way.
I sense an opportunity here: managed hosting of Fediverse services. I don't mean a managed host where you can install/run the services. I mean a top-to-bottom setup, management, backup, upgrades, monitoring, etc. so the only thing you need to do is administer the community. I'd love to set up several Fediverse services for my local community, and I know there is an audience that would also love that, but I also know I do not want to invest the time it takes to manage the technical side of that.
Having easier to set up instances would help in relieving the pressure from the more popular current instances. We're starting to see those hosting options come on line for some of the services, but not fast enough for my liking.