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There are two changes which together can solve this problem:
  • Obfuscate Nostr traffic using Tor's Pluggable Transports; and
  • Make smarter Nostr clients that post the user's notes to random public relays. Such clients would be able find those notes (this is complicated, but very feasible). This would make it possible for relays to become disposable, and so blocking individual relays would become futile.
These two changes together would make Nostr nigh uncensorable.
The second change is the most important and it is rather complicated. At the moment, I don't have the time or energy to explain it. But if someone shows interest, I could set aside some time to write up an explanation.
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Is there ongoing work in this area?
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AFAIK, no one is working on either traffic obfuscation or smarter clients. Most Nostr devs are focused on building social media apps -- a focus which is slowly killing the future viability of Nostr.
I would write the code myself, but I'm far too slow at programming; I can't make meaningful progress in my free time. Plenty of ideas, but no ability to implement them. The years I wasted not getting good at programming have finally come home to roost.
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The ability to penitrate network blockade is very important for Nostr. Otherwise, it can only be a transition protocol. Hope you can write up an explanation to inspire more people do the work.
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