Note that the standard doesn't say anything about blocks, so each piece of fedi software can do something different.
Mastodon implements suspension by refusing to accept any signature from the defederated domain as valid[*], refusing to actively talk to it, and iiuc dropping users from that domain from some lists (e.g. followers' lists). More importantly, it doesn't tell any other instance about this block (and i think this is actually a shared decision by most fedi software).
The latter property means that B can't even tell that A suspended C, so had no way of knowing that A would not want its messages forwarded to C.
The former property implies that A will ignore boosts of messages from C (because they point at an invalid message).
[*] I didn't verify experimentally, but it seems to, somewhat amusingly, have also applied to Delete messages, so i assume that if A defederates from C, it will stop honoring C's requests to delete messages it has previously received from C.
@rysiek
Ah, and for even more confusion:
if A defederates C, and someone from C responds to post from A (that they've gotten via e.g. third-party boosts) then this response:
a) will be visible on C,
b) will not be visible on A,
c) I _think_ will be visible on unrelated instance X if someone from X follows the response's author and the response was not unlisted or mentioned someone from X (I haven't verified this experimentally, but this follows from how I understand ActivityStreams).