You are right, fusion reactors are used.

They overheat so hard that their fucking ammo cooks off even if it is stored in the extremities, i do not want to stand anywhere near a diesel-powered Mech, or even worse, pilot one when it fires a PPC Salvo.

Yes, most mechs have fusion reactors, but there are certain types of mechs (generally called "primitive") which may use internal-combustion engines.

I think is cause the style more than the actual tech that it has.