Some commercial reactors are secretly used for this purpose even today.
Nuclear may have a bright future but it's extremely difficult to cleave energy from the state interest in weapons. And I'm not just talking about the US, this is an issue with nuclear power worldwide.
The biggest blunder was using nuclear technology for bombs first. I'm afraid the word is forever tainted by history.
Also, I need to some source for the claims that Atoms for Peace was meant as a cover to transfer nuclear technology. I believe the program was created as a way to provide civilian nuclear generation capabilities to friendly nations, in return for a guarantee that nations would not use the technology for making nuclear weapons (India was probably the most famous "rogue": they used the know-how from the research reactors to build an actual nuclear weapon).
Same with Sandia Z Pinch machine and NIF. It's all dual purpose tech to simulate bombs since actual testing isn't done anymore.
You won't find anyone that says it outright but the government interest in pulsed power is awful suspect.