The main issue is that Lemmy instances, by default, only know about their local communities and remote communities that the users of that server have deliberately subscribed to. Some smaller instances are running federation helpers which are bots that search for remote communities to fix this.

All is based on what people on that instance are subscribed to most, not just federation

You subscribe to individual communities. So unless a user or the admin already subscribed to a community there won't be any content there from those communities.

Even after subscribing only new content (and old content that has had replies/likes) will show up.