This is just regular moderation, though.

It’s using the existing tool, but making a small portion of them (approving applications) available to a much larger pool of people

it doesn’t resolve the question I raised about what happens when two instances disagree about whether an account is a bot.

If the instance that hosts it doesn’t think it’s a bot, then it stays, but is blocked by the instance that does think its a bot.

And if the instance that thinks its a bot also hosts it, it gets shut down.

That is regular fediverse moderation