While I think the current direction of performance gating for instances is already a huge benefit for event hosts, I think it would be even more beneficial to allow instance hosts to change the performance settings while the instance is already live (similar to the options available for items, stickers, etc) in order to adjust for the changes in attendance numbers.
For instance, during a full 80-person instance, having "poor or better" enabled would be a huge benefit. However, during the very beginning and end of many events, the attendance may only be something like 30 people. In this case, an avatar performance limit may not be needed.
This could also be used for events with a raised instance cap, such as 100+ person instances being able to change to medium or better.