No. In both cases, they’d either have to manually block federation to your instance, or be operating on a whitelist-only federation basis.
Once you spin up your own instance and browse around a bit/subscribe to some communities, wait a bit, and then click on the “Instances” link at the bottom of the page and you’ll see a bunch of instances that will have automatically federated.
This is exactly what I’m doing and it has been working great so far.
Do the big instances need to give permission, to your self-hosted instance, to read and post on their communities?
Do those instance owners need to manually approve access from some unknown small instance?
No. In both cases, they’d either have to manually block federation to your instance, or be operating on a whitelist-only federation basis.
Once you spin up your own instance and browse around a bit/subscribe to some communities, wait a bit, and then click on the “Instances” link at the bottom of the page and you’ll see a bunch of instances that will have automatically federated.