At point is it legitimate for a certain government (state, city, municipal etc) to say a commodity or service (water, utilities etc) should be a right for all of its citizens? And provide the public utility as a monopoly?

Will emerging network states / city states do the same?

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Logistically how will it work? Will the network state negotiate with the government that it resides in? 

Will the local government always have leverage over the public utilities of the network state citizens (shut off water, electricity etc) if there is any conflict? Could that be used by the local govt for leverage?

Most likely when the citizens demand it, or when investors want the government to cover costs they might normally cover.

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E.g. water is going to be hard to turn off and on based on what network state you are going to be a part of - HW is harder than SW

Traditionally, citizens, cities and the governing body have been in the same place. if the citizens and its cities are separate, how to provide them physical infrastructure services adhoc?

Perhaps at such time as the governing entity is able to define “citizen” and restrict services to citizens only. Otherwise, it will become a “free stuff” advertisement for imminent exploitation.

If that state is democratic and collectively decides to decommodify xyz thing, then I view that as legitimate.

When the people decide that's the way it should be. Democracy baby!

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IMO only for market failures (i.e. when the negative externality of a good not being a social good is not priced in by the private markets)

Rights as a feature: People move to the state that better fulfill their needs.

Instead of granting rights, network states offer them.

Re: 1. Have you read The Master Switch?

Goes into great depth and length re: the evolution of information technologies/new media during the 19th/20th centuries, and digs into the details of how each relates to public utilities

Re: 2. I don't know enough to take a forecast position.

prospera mentioned that they are providing utilities via private providers

prospera mentioned that they are providing utilities via private providers

https://www.youtube.com/live/x-GfuIFkB_Y?si=5Lzl9Svidge-qt3E&t=3823

the point at which the economy of scale can undersell all competitors, but this is kind of dangerous cause there's no explicit guardrail for credible neutrality. 

ideally network states lean hard into fat protocols 100% "down the stack".  some services consume a huge margin instead of accelerating market competition.

Yes, if these rights are enshrined in the law and supported by social welfare policies, in my opinion it is legitimate for a government to provide essential commodities or services as a public utility, especially in a stable country.