TL:DR mode at the bottom.
I do wanna point out that Gnomeragon is, in-game at least, significantly larger than both Stormwind City and Ironforge put together, and we only explored a portion of the great City of the Gnomes.
And being entirely subterranean, it required lighting. Heating as well, since unlike Ironforge, it didn’t have a massive lava-flow to provide heating to the entire city, and underground, the temperature rapidly decreasing without sunlight … and the surrounding region is snow-locked all year round.
I would suggest that while the Gnomes did indeed rely upon conventional reactors to power and heat their city, hence why the radiation issue exists in the first place, the Gnomes are both smart and intelligent. They’d have to know the risks of a reactor breach, and the dangers of the materials they worked with, so alternative power-sources and backups would be required. Arcano-tech and magi-tech is well known amongst the Gnomes and despite the emphasis on ‘non-magical’ tech being their pride and joy, I have little doubt that for non-essential systems and private power sources would have relied upon arcane batteries for power, and to avoid overly draining the city’s already labyrinthine power network.
There’s also the issue that Gnomeragon goes deep, deeper than Ironforge does, rivaling even the lava-locked city of the Dark Iron Dwarves for burrowing into the crust of the world. That means that they’d have easier access to the larger, more dense leylines to tap for power, and the sheer depth of the city meant that divinations and scrying from magical entities, such as Dalaran, would be hampered by miles and miles of stone, earth, metal and machine. No Death-Squads being sent down to kill Gnomes experimenting with teleportation magic like what Dalaran did to everybody on the surface.
TL:DR mode, the city proper was powered by potent reactors, but we’re never told what the elements they used for fusion/fission were. Odds are the reactors may have used the ley-lines as a fuel-source and the radiation was the side-effect of so much arcane energy being processed into electrical energy. Or, the Gnomes’ ancestors found Azerite after the founding of Gnomeragon and used these ‘miraculous’ crystals as a power-source, feeding arcane energy as a replenishment energy into them while using the Azerite as the primary fuel source to power their city and grow their society.
Arcano-Tech and Magi-Tech is well established in Gnomish society, and Gnomes are always looking to streamline and improve their technology to avoid doing undue harm to their surroundings and themselves, so if an arcane option exists and will do the job, the Gnomes, as a rule, don’t see any issue with using it alongside their more common engineering skills.