Most nitter instances don't do anything to avoid legal trouble from X. They simply hope that X will not go after them. There are some instances which do put in effort to stay anonymous, and they usually do that with a Cloudflare tunnel to hide their server IP and by not posting any personal details online.
Like some other things reddit tells visitors, they're basically lying, or at best, being inconsistent. I've tried old reddit here and there in the past month or so and sometimes it says I need an account for "safety", other times, it doesn't.
I tried it with a browser that probably still has cookies from an account I deleted 4 months ago, with no problem. Then, tried it with a Private mode window - that one asked for a login.
It's regional, in some countries they force logins, in others not. In some countries, r/all isn't available at all on mobile for example, you get redirected regardless of how you try to access it, but seemingly work in other countries.
how would you (EDIT: publicly) host such a nitter instance while avoiding the risk of legal consequences?
since old.reddit (EDIT: on mobile) is closed for visitors without an account it would be great if there was also a neddit project.