I hope you are donating to your instance, otherwise by your logic you are stealing there resources.

How is that my logic? Admins of my instance are fine with people using their instance without donation so there is nothing unethical here. If people must pay to use their instance then it can’t be called “donation”, it’s called “payment”.

If the server owner isn’t fine with others hottlinking they can simply deny requests

Can I use same logic to say if you are not fine with people robbing your home, you must lock your door?