I ask generally out of curiosity. I was just thinking that as big social media fractures, old school isolated forums might become "cool again", and that one of the achievements of lemmy might be as a nice platform for simply running a forum for whatever community you want all without needing to worry about federation.

If it turns out that work of federating data is a substantial part of the resource overhead, and that an isolated server would actually be quite efficient, that'd be quite a nice feather in the lemmy cap I'd say. Hexbear seems to have been using lemmy this way for a while and it seems to have been successful too.