What engine is modern warfare 3 powered by and what other games have used this engine? Is it a very "modern" engine or is it a bit dated?
Modern Warefare 3 is running on the IW engine this engine was originally based off the Quake 3 engine created in 1999. This engine has gone through several different versions and has been used for several different games.
As to whether it is dated or not is a bit of personal opinion. In my view it is pretty outdated these days.