Here's a question: What about Illyria? It's located near the Delphic Expanse, which is only about 50 light years from Earth. All that territory in any direction is owned by Federation member worlds, so far as I am aware, which means they've got Federation space all around them.
They are a scenario in which they are not allowed to join the Federation because of the ban on genetic engineering, yet they're still a warp-capable spacefaring race and, in some ways, a little bit more advanced than general Fed tech, seen in SNW during Una's trial. So what happens to them? Are they "penned in" by Starfleet, unable to expand and colonize other worlds? Are they not allowed to use well-protected and patrolled warp travel lanes that are under Starfleet jurisdiction? If they are attacked by pirates, or if their territory was somehow breached, would Starfleet not be compelled to assist? The Federation sometimes seems to be a little fickle, especially when it comes to other cultures not sharing their same "values", and that genetic engineering thing is a biggie! How would something like that actually play out?
They are a scenario in which they are not allowed to join the Federation because of the ban on genetic engineering, yet they're still a warp-capable spacefaring race and, in some ways, a little bit more advanced than general Fed tech, seen in SNW during Una's trial. So what happens to them? Are they "penned in" by Starfleet, unable to expand and colonize other worlds? Are they not allowed to use well-protected and patrolled warp travel lanes that are under Starfleet jurisdiction? If they are attacked by pirates, or if their territory was somehow breached, would Starfleet not be compelled to assist? The Federation sometimes seems to be a little fickle, especially when it comes to other cultures not sharing their same "values", and that genetic engineering thing is a biggie! How would something like that actually play out?