Last time I checked they didn't do it particularly efficiently and avoiding "FPS death" was an important part of the lore: cap the number of dwarves, avoid flowing water, wall off unused parts of the mine to reduce costs of pathfinding, add pathfinding weights to tiles, etc.
There's not much published about the internals because the creators keep it to themselves.
Cats are the death of fortress. Dwarf fortress is an incredible game but you are right that it’s actually amusing the amount of weird things you know you should avoid or manage as a regular player.
Bah, put the kittens in a cage and release them upon unexpecting intruders. 50-60 kittens will tear a Kobold apart if you lock them all into a small room.
For the un-initiated: Yes, Dwarf Fortress is a brutal game.
There's not much published about the internals because the creators keep it to themselves.