As for the general 'high magic' vs 'grim' of the IK setting. I actually think it is both. The setting is a world that is just entering into the industrial revolution, except with magitech. The dawn of the industrial revolution was both a dark and grim time, and a time of great wonders. I figure an IK campaign should capture both as they exist side by side.
I actually think the setting evolved over time, and changed. Probably in part due to the loss of Brian Snoddy and Matt Staroscik, and the company being left in the hands of Matt Wilson, who had a different vision on his own than the three of them did together (although I admit this is speculative, it fits the evidence, IMO.) You've gotta put IK stuff on a timeline to see the change. For Dragonblade, wanting to play Warmachine the RPG didn't make sense in the early 2000s. Warmachine didn't even come out until more than halfway through 2003, and it was much smaller and less "epic" in scope until the first wave of supplements and revisions to the original game started coming out in 2004 or 2005 and beyond.
The first part of the Witchfire trilogy came out in March of 2001. The whole trilogy was out by November. The Lock & Load character primer came out in January of 2003. The campaign setting was underway and hotly anticipated long before 3.5 was (although Privateer Press were notoriously late with releases, and the campaign setting was anticipated for literally years before it finally was finished. Nonetheless, I think it was in many ways an artifact of an earlier stage of development of the setting and its tone and themes.)
Warmachine came out in latish 2003 (August, I think.) Originally, it was a very small skirmish game, with small groups, and was fairly modest in scope. It was only after considerable time that it became really comparable to 40k in terms of size, scale, and "epicness."
If there's a dissonance in tone between the miniatures game and the RPG setting, it's because the miniatures game has evolved into something very different from its roots as a d20 adventure publishing company. The setting was
always originally pretty dark, grim, low magic, and kind of a steampunk horror toned setting. Until Warmachine started selling like crazy, two of the three original owners left, and the remaining one started seeing himself as competing directly with Games Workshop, that is. It wasn't really until the mid-2000s that the setting became one of being, as Dragonlance says, a "big badass" in a high magic setting.