Ah yes. Lemmy really was not designed to appeal to end-users so much as self-hosters who want to spin up their own instances.
Then the Rexodus came, and of course people want what they want, but the entire design philosophy only makes sense when you see it in that light. Westerners primarily still only want a "Reddit replacement", except somehow without spez at the helm, whereas Lemmy is actually pushing for something entirely different: decentralization.
At which point instances going poof is a feature not a flaw in that model. Though images disappearing could be worked on to better serve a variety of needs - e.g. posters could set a flag that their image is higher priority - and perhaps mods and definitely admins could then modify that - which could affect the automated longer term storage handling.
But Lemmy still isn't finished yet, despite how many years have gone by, and due to how slow it is to change (driven in large part by it being written in the highly complex and niche Rust language, but several other factors exist as well including funding, which interrelates with the whole tankie issue, etc.) now many people are giving up on it and pinning hopes instead on PieFed to drive changes to the Threadiverse (it being written in Python and with a highly productive and passionate team of volunteer developers who aren't asking for money before making such things happen).
So I expect things to change in this regard, but in all likelihood in PieFed but whether Lemmy itself ever decides (or is able) to catch up with it I cannot guess. Maybe eventually, one day, in another few years.
Tbf, the AI tools also don't work right, which might have some small bearing on whether people choose to use them or not:-)