ONTAP Cloud HA can work on top of 2 AZs only. This setup, while working, is not optimal in a way that it may not save you from AZ failure,
but it is good for any other failure.
The spread of instances should be one data node per AZ and the mediator in one of them.
If the AZ without the mediator fails - You'd have HA.
if the AZ with the mediator fails - The other node may still work, but you won't have HA and there would be no failover.
It would still protect you from instance/storage/network failure to one of the data nodes.
Hope that helps,
Solution Architect Team Lead