I think the activity feed for a site is one of the most important engagement mechanics, particularly a discussion forum. I don't like the current design. It gets the job done but the information as presented has a lot of redundancy and you can't directly engage from the screen. I think there are two routes the design could go depending on how you'd like to drive engagement.
The first would be to keep it largely as things currently are where it's a click-through screen and you have to go back to the thread to do your reactions / replies. The major change I'd like to see is having everything for a thread compressed down into a single entry. Clicking through would take you to the new posts marker and you'd have to scroll down and read the thread to react/reply. This makes the thread the unit of engagement and the notification is basically "hey there's something new, re-check the thread". I think (without evidence) that this style pushes people towards reading the stuff they're scrolling past and drives larger posts at the cost of lower activity.
The second would be to expand the activity feed to allow the user to not need to go to the thread. Direct replies and reactions are split out into individual items like they currently are and you expand the replies to be full size and allow direct responses and reactions directly from the feed interface. This makes the post the unit of engagement and the activity feed becomes more like a (current) thread where the only commonality is the user's activity. Reddit does it this way and the style scales to larger discussions but if you read a heavily commented post as a whole the thing feels (and is) a bunch of disconnected conversations. I don't mean to make this sound bad, I like it quite a bit and I think it delivers a lot of Reddit's stickiness.
I think the current activity feed is kind of halfway between the two and as someone who's obsessive about unread notifications it really bugs me that re-engaging with a thread doesn't clear all the unread markers and I have to click the "mark all" button to have the "new notification" marker go away. This is my true motivation for the post but I'm trying to post something higher value than "the unread marker drives me nuts".