Hello Ed,
I'm sorry that we still haven't add this moderated approval feature in the front end, make a lot of user confusing and inconvenience.
Yes, I'm agree what you said that. In the temporary solution is you can set the permission which file can't let moderator to open it, i will guide you how to do this :
Example : The moderator user is under Manager, then i want to set the permission which file they only can view, which file they can't be view
Step 1 :
http://screencast.com/t/cjWJTcDICf
Step 2 :
http://screencast.com/t/0PZlmfE3i
But it not only set the permission on this EasyDiscuss option side, if you want to be more secure for moderator access in your Joomla backend side, you need to set all the menu permission option, please let us know if you need further assistance.