I don't doubt that Mod Abuse was an endemic problem of reddit, and nothing of the following applies to big subs or communities or instances.

But mods are a nessesary part of healthy communities, Mods not only police the rules of a community but they run it as well, and sometimes they end up being the ones handling sensitive or controversial information.

I dout it commonly happens in huge communities, but when people feel they belong somewhat to a community they start to feel safe to share things they probably wouldn't elsewhere online (if at all), and the day may arrive that some of this people, may found them selves in a mental health crisis, in the verge of suicide, and, being alone otherwise, will try to use this communities as a last resort, or straightforward post a suicide letter, and in most cases is up to mods to have to deal with that situation, Other things such as doxxing, or even naive people who put them selves in danger or expose too much without realising need to be privately discuss.

Is something mods do many times because there is just nobody else to do it, they are the only ones there, the only ones able to do something even if something few, and if that was already a thing on reddit, here will be much more of a thing.

Alongside things such as controversial decisions, who is to become mod and if somebody deserves a ban or not as well.

At the end of the day, you need people passionate for the community, that will do that work (i can tell from personal experience that moderating is a thankless hobby.) for free and for real, and not to manage tons of things for a wage or another kind of benefit.

TL:DR; Sometimes mods have to deal with sensitive stuff that shouldn't be at all in the public eyes.