I think the cat meat would be mixed in occasionally with the lamb so as to reduce the amount of lamb in the skewers. On a small scale, it probably makes economic sense for individual stall holders. But yeah, you’re right about the texture and stuff. Hopefully it’s just another vicious rumour!
As for McDonalds, a meat processor in a dog food factory informed me that a meat supplier used to supply the same bits of beef (lowest grade of meat fit for human consumption) to McDonalds also. The dog food manufacturer stopped using that quality of beef for their dog food *9 years* before McDonalds stopped doing the same for their consumers. This was a source in the UK, so I’d guess it holds true at least for the UK.