I definitely like this general line of thinking, but I want to look at the censorship part a bit more carefully:

The distinction between 'relays' and mastodon 'instance servers' is a real one in as much as a relay doesn't "own" its clients, but what stops relay operators from blocking posts or users they don't like; you can say 'well you just use the other relays', true (probably redundantly), but relays might coordinate in the same way as current mastodon instance owners do, publishing ban lists that "right thinking people" all agree on.

I would like to say there is an encryption/blinding based cryptographic solution, but I don't see it, currently (if anyone can decrypt, so can the relay operator! - at least in any practical system that's going to be true) ... unless you entirely ditch identities, which removes the whole social network concept.

I would guess that the counter-argument is: well, you only need one non-censoring relay, so the decoupling of users from servers in this sense could well be enough. Hmm, probably. Servers can be shut down, though.