Personally, I’m happy with both. Lemmy and Mastodon are far from perfect and both feel sorta beta, though Mastodon is further along.
Search is weak on both platforms, imo, but I expect it will improve eventually.
You mention favorite counts only being your instance, but same is true for community subscribers here.
Also landing on other instances from outside links can be confusing to find the same content in your instance (Mastodon and Lemmy).
Federation does make things more complicated. But it beats centralization.
In the end, it comes down to your personal end use and preferences.
Personally, I like Mastodon for conversations and I like Lemmy for community building - I mod !alternativenation@lemmy.world - and that works for me. 💕
(Though I’d kill for some consistent performance from Lemmy after trying to comment 3 times)
Fwiw. I’m on Mastodon and Firefly amd honestly they are pretty much the same. One had more features, ones more stripped down, but it’s still just share some words, maybe a photo or video & post, the people like, reblog, share, or comment/reply.
I don’t feel the need for longer post, rich text, or 1000 emoji reactions so I stuck with Mastodon.
And Lemmy/Kbin is scratching my Reddit itch, especially as I’m working hard to build an alternative music community here.
If you are into photos more, there’s also Pixelfed.
What’s great about Mastodon and Lemmy specifically though? The apps. Both have a ton! I’m on Mona for Mastodon and Memmy for Lemmy and it’s really made all the difference.
Finally - don’t worry about mastodon.art - they aggressively defederate from everyone all the time.