I mostly agree with you, but we may disagree on the implausibility of exotic physics. Do you consider all explanations which require "exotic physics" to be less plausible than any explanation that does not? If you are willing to entertain "exotic physics", then are there many ideas involving exotic physics that you find more plausible than Catastrophe Engines?
In the domain of exotic physics, I find Catastrophe Engines to be relatively plausible since are already analogues of similar phenomena to Catastrophe Engines in known physics: for example, nuclear chain reactions. It is quite natural to think that a stronger method of energy production would result in even greater risks, and finally the inherent uncertainty of quantum physics implies that one can never eliminate the risk of any machine, regardless of engineering. Note that my explanation holds no matter how small the risk lambda actually is (though I implicitly assumed that the universe has infinite lifetime: for my explanation to work the expected life of the Catastrophe Engine has to be at most on the same order as the lifetime of the universe.)
It is also worth noting that there are many variants of the Catastrophe Engine hypothesis that have the same consequences but which you might find more or less plausible. Perhaps these Engines don't have "meltdown", but it is necessary that they experience some kind of interference from other nearby Engines that would prevent them from being built too closely to each other. You could suppose that the best Matrioshka Brains produce chaotic gravity waves that would interfere with other nearby Brains, for instance.
Personally, I find explanations that require implausible alien psychology to be less plausible than explanations that require unknown physics. I expect most higher civilizations to be indifferent about our existence unless we pose a substantial threat, and I expect a sizable fraction of higher civilizations to value expansion. Perhaps you have less confidence in our understanding of evolutionary biology than our understanding of physics, hence our disagreement.
For the sake of discussion, here is my subjective ranking of explanations by plausibility:
I ignore the hypothesis that "we are in a simulation" because it doesn't actually help explain why we would be the only species in the simulation.
EDIT: Modified the order
Before we go further:
What specific observations and evidence does your idea explain, other than the Fermi paradox?
What specific observations and evidence, if we had them, would invalidate your idea?
The Fermi Paradox leads us to conclude that either A) intelligent life is extremely improbable, B) intelligent life very rarely grows to a higher-level civilization, or C) that higher-level civilizations are common, but are not easy to spot. But each of these explanations are hard to believe. It is hard to believe that intelligent life is rare, given that hominids evolved intelligence so quickly. It is hard to believe that intelligence is inherently self-destructive, since as soon as an intelligent species gains the ability to colonize distant planets, it becomes increasingly unlikely that the entire species could be wiped out; meanwhile, it appears that our own species is on the verge of attaining this potential. It is hard to believe C, since natural selection favors expansionism, so if even a tiny fraction of higher-level civilizations value expansion, then that civilization becomes extremely visible to observers due to its exponential rate of expansion. Not to mention that our own system should have already been colonized by now.
Here I present a new explanation on why higher-level civilizations might be common, and yet still undetected. The key assumption is the existence of a type of Matrioshka brain which I call a "Catastrophe Engine." I cannot even speculate on the exotic physics which might give rise to such a design. However, the defining characteristics of a Catastrophe Engine are as follows:
The Catastrophe Engine is by no means a conservative explanation of the Fermi Paradox, since only the very most speculative principles of physics could possibly explain how an object of such destructive power could be constructed. Nevertheless, it is one explanation of how higher civilizations might be hard to detect as a consequence of purely economical motivations.
Supposing this is a correct explanation of the Fermi paradox, does it result in a desirable outcome for the long-term future of the human race? Perhaps not, since it necessarily implies the existence of a destructive technology that could damage a distant civilization. Any civilization lying close enough to be affected by our civilization would be incentivized to neutralize us before we gain this technology. On the other hand, if we could gain the technology before being detected, then mutually assured destruction could give us a bargaining chip, say, to be granted virtual tenancy in one of their Matrioshka Brains.