Yes, you can do that. But if you run your own server you can configure more complex filters to handle situations where mail is flagged - discard loudly (telling sender), discard silently, move to special folder if unsure of spamminess, let through.

Then you start getting an amazing number of emails to alice@yourdomain.com, bob@yourdomain.com, chris@yourdomain.com, dan@yourdomain.com, ceo@yourdomain.com, sales@yourdomain.com, etc.

Do you mean ESP or ISP? Relying on an ISP email forwarder doesn't work because if I move and cancel my service, I lose all these forwarders.

What ESP do you recommend for unlimited (or large numbers of) aliases indistinguishable from individual email addresses (such as ycombinator4853@foo.com facebook843983@foo.com but not john+ycombinator@gmail.com john+facebook@gmail.com)?

Edit: fastmail's standard $50/yr plan offers 600 aliases. This might be good enough. I've created online accounts at 371 different services over the last 20 years.