I've always said that DNI isn't about actually setting boundaries anymore, it's virtue signaling- as much as that term has been co-opted in loathsome ways by vile people, it has some use here.
If you put 'racists dni' in your bio, a racist isn't going to see it and go 'aw, nuts! i have to go away now' like Swiper the Fox. Either they're not self-aware of their own racism ('i have black friends!') or they are aware, and they're going to interact double because they see you as a target now. Same with homophobia, transphobia, ableism, etc. etc. And for less high-stakes criteria- if you have 'dni if you like Sword Fantasy 3: Return Of Sword Fantasy', its fans are just going to not bring up that they're fans to you, because that's a silly thing to unperson someone about. You're better off saying 'i have SF3ROSF tags muted, please don't talk to me about it'.
The use of a label like that isn't to ward anyone off or to do any good, it's to show to your friends 'i support the right social causes! i promise!!!', which is maybe a symptom of a greater problem the internet (especially young gen z) has with prioritizing the appearance of purity and goodness over actually doing what's right
When it comes to, like, retroactively adding tumblr posts to have 'terfs go to hell' in big flaming letters, that does something. If the post has been co-opted by a group who you disagree with, adding explicit messaging against them will stop it spreading in their circles (and possibly cause some infighting, if they're extra-extremists and even an accidental show of disloyalty is enough to get someone on the shitlist). But the bio list is useless- sometimes worse than useless, honestly.
If I could control the layout a bit more, Kossai's whole post would go here. It's great, faer wording is phenomenal and I can't really expand on it. Scroll back up and read it again. In the accepted format of the DNI, there's a lot of really easy ways to accidentally do harm to people you would otherwise get along with.
Here's a story I tried to tell about that, and then it turned into a longer, more generalized rant.
The main valid use I've seen for a DNI is "minors dni" as a way for nsfw creators to try to cover their asses pre-legally: without the ability to card everyone who looks at your posts, a sign telling them to fuck off is a solid argument that you're not trying to expose minors to porn.
The main use I've gotten from other assorted DNIs is telling very quickly that a user is Not Worth The Effort and quickly blocking them before they start some bullshit.