That's definitely a good point in the case of a mass exodus like what happened with Reddit. But even in those situations, I don't think this means we need to direct people to tiny instances. Lemmy now has a bunch of solid instances (lemmy.world, lemmy.ml, sopuli.xyz, sh.itjust.works, lemm.ee, lemmy.ca, etc.), so if some mass immigration to Lemmy were to happen again, you could say something like the following:
"Pick lemm.ee, sh.itjust.works, or lemmy.world; doesn't matter too much since they're all decently large instances with good moderators."
Saying something like this:
Narrows the options down to a small few that don't really differ for the new user
Leads them to an established instance with a lot of people, making them more likely to stay
Splits people between instances so we don't get instance slowdowns, shutdowns, etc.