But local-first !== defaults to local inference, right?

I'm not sure I understand the question. Regardless of what provider you choose - be it cloud based or local - you have to provide setup information such as host, authentication, etc. So it "defaults" to nothing; you have to select something.

Maybe this will be a clearer question: What does "local-first" mean in the title that you typed in for this HN submission?

Local first means running Atomic with local models is not an afterthought. It’s a first class citizen that works just as seamlessly as running with a cloud provider - assuming you’ve done the work to provision the local models and their connections yourself.