My understanding was that THP is disabled anyway. What would this defrag feature be doing now?
I don't know if I ever fully understood the problem, but it sounds like at least in your case it's related to large shared_buffers, and hugepages, which cannot be swapped out.
Basically the problem is our DB host getting slammed with connections (even with pgbouncer in place). We see the CPU load spiking, and when we check "top" we regularly see "kswapd" at the top of the list. For example, just now kswapd is at 72 %CPU in top. The next highest is a postgres process at 6.6 %CPU.
Our shared_buffers is set to 32GB, and HugePages is set to 36GB: