It's true that a website using Cloudflare is more independent than a Facebook page, in that in the former case, the company can take their domain to another provider. But my idea of an independent Web is a large number of websites depending on a large number of high-quality hosting providers. The latter number will inevitably be smaller, but shouldn't be single-digit. That would lead to too much potential for abuse of power.
Also, the more sites are using a single provider with its black-box algorithms and heuristics, the more potential there is for bad consequences for innocent users when those things misfire. That's what worries me about the bot-fighting feature you launched on Monday.
To respond specifically to part of what you said:
> The concern was that the challenges of being online would get so hard that individual websites would give up and just move to run Facebook pages.
I don't think I understand how Cloudflare actually helps here. I think the average bar, karaoke DJ (I love karaoke), spa, or other small business that might just use a Facebook page would be served just as well by the kind of hosting provider that gives your website a single IP address pointing to a single machine. Are DDoS attacks and bots really that big of a problem? If so, I haven't run into them in the 16 years that I was the programmer and sysadmin for a small company (admittedly, online services are that company's business). Maybe we just didn't make the right enemies? Now, maybe small web hosting providers could make it even easier to set up a new website, but Cloudflare doesn't do anything about that problem anyway. If the concern is performance, maybe we need better alternatives to WordPress and Drupal, and more local hosting providers, so the website for small businesses can be closer to their mostly-local customers without using a CDN.