Bad bad bad bad bad bad.
I firmly believe that no instance should harbor a large portion of activity on the fediverse, as it makes it difficult for other instances to defederate from them (as users there would lose a massive portion of the content that they see) and easy for them to take users from other instances by just ceasing to federate (as users on other instances would have to go to the large instance to keep the level of activity their used to). And that's in regards to microblogs like on Mastodon.
With communities, it'd be so much worse.
If Reddit federates, and Lemmy/Kbin instances don't defederate en masse, almost every active community will be on reddit.com. No reason to post on minecraft@lemmy.world with its 5 posts a week when Minecraft@reddit.com has millions of subscribers and thousands upon thousands of active users. Nearly all activity will go to subreddits, the exceptions being from people who have blocked Reddit or on communities pertaining to non-Reddit platforms/instances (e.g., kbinMeta@kbin.social). And if Reddit defederates after that, the threadiverse will be a ghost town. People are already (and justifiably) concerned that too many people and big communities are on lemmy.world. Just imagine Reddit coming in with all of its users.
If Reddit federates, it's just gonna straight up be embrace and extinguish — no extend required.