Credible exit matters too. The idea that all of this data is signed, public, and verifiable by anyone helps ensure that the provider is accountable to the community. A provider might decide against enshittifying a product if they're worried about a competitor doing better and taking their place.
Yes, an atproto lexicon will tend to be dominated by a small number of nodes. It's not the perfect distributed system some would prefer, but it is a real improvement on the completely centralized models seen everywhere today.