Here, this is the closest thing I've got to 'proof' on hand (good thing I keep backup of my logs and can match time stamps to screen shots):
If block works, Old Duck has magnanimously (that's sarcasm, for the record) extended his benevolent reality distortion field around my CMDR, meaning that anyone who has shot down CMDR Old Duck was not going to be able to try themselves against my CMDR's shieldless trade corvette during it's approach (I recall seeing Old Duck repeatedly in SC when I took that screen shot, before I shot him a friend request) to that station (which is moderately well trafficked). This is certainly a negative, for me, and for those who would care to have their CMDR attack mine, or intervene in such an attack, or witness it, or just talk to CMDRs actually present.
Counter-points:
1) Instances are very short lived. Just because I'm in the same system doesn't mean we'll be in the same instance for the duration. If I'm at the station when you jump in to the system in supercruise, you'll be in a different instance. If you drop out at the station and I'm leaving, we'll pass each other, sharing that instance for perhaps a minute, and then I'll leave your instance as I go my way and you go yours, meaning that I have a one minute window to block someone else from entering your own instance.
2) Friends take priority, so if your worried that I may have blocked your friend, don't be, because if they are your friend in game, you'll be instanced with them rather than me. If you want to be instanced with gankers I may have blocked, just friend them! Problem solved.
3) If you are worried that you are not being instanced with some random unknown dude, well that's just silly, because any number of factors may prevent you from being instanced with some random unknown dude. That's like me getting mad at stop lights in Washington DC because they might per chance keep me from sharing the road with some random important politician. Now if later it comes out that through shear random chance you were prevented from being instanced with Henry Cavill for the 90 seconds we were both in supercruise together (which is silly, because I would never block Henry Cavill), well go ahead and post the video and I'll say, "I'm sorry!"
You act like a single instance is the entire game shard, when in reality we are popping in and out of instances every couple of minutes. The only reason you would be "stuck with me" in an instance for any great length of time is if we were winged up or something. Heck, even a CZ doesn't last very long!
The only valid complaint I can see you leveraging from this is if the majority of players in Open were to block the gankers, which would basically create "friendly open" and "hostile open", at which point your argument might carry some weight. I'm pretty sure we're not there yet. If anything, forcing everyone into Solo does the same thing, except that you don't even get the chance to instance with those folk.
1. Instances last as long as they are held open (in well trafficked areas this can be days at a time...some people idle inside stations from server reboot to server reboot), and preferential weight is given to CMDRs previously instanced with. I know from experience that we personally are very likely to be placed together, repeatedly...even before I added your CMDR to my friends list.
2. Friending does not override a block; it has a much lower weight. If I wind up in your instance first, I will be excluded from those I've friended, or even those I'm winged with. More importantly,
I'm not playing in Open to play with just the tiny fraction of the population I'm willing to friend. I want to play with as many people as possible, even those I would never want on my CMDR's friends list because I don't want them tracking him around. My CMDR isn't an idiot and doesn't give his enemies his transponder codes...but that doesn't mean I don't want to play a game where the characters of other players cannot be enemies of mine.
3. Barring technical issues or a maxed out instance, my CMDR is very likely to be instanced with any other CMDR present. In instances with populations below a dozen or so, I will reliably be instanced with everyone who is in NA or Western Europe who doesn't have a broken network. On a good day, everyone in Open in the system chat will be in the same instance. Being unconnectable or having an excessive ping are the main factors, other than block, that will prevent instancing.
There is no requirement for the majority of players to block to cause problems; even a few in a populated area will cause issues because they all overlap, creating mutual exclusions. Indeed, the more people that are around the more likely it is that a block is responsible for the presence of any given instance.
It only takes one blocker to cover an entire instance, so the more people, the more chances that someone present will have a block that applies to someone else. The moment that happens, there is another instance that would not otherwise be there, which is a clear dilution of the Open population, above and beyond all other factors.
If the goal is to encounter as many people as possible--which I think is entirely rational for Open--a one in four chance of encountering someone is objectively better than a one in six, or one ten. Four instances of fifteen people is objectively better than six of ten, or ten of six.
Not being able to pin down the precise reason for any failed pairing does absolutely nothing to detract from the argument I've been making.