Many people have been asking about how Pokemon Fusions work in the game, so I thought I'd make a post detailling it.
Species
The order matters when fusing Pokémon. Psyduck + Slowpoke will result in the body of Slowpoke with the head and color of Psyduck, while Slowpoke + Psyduck will result in the body of Psyduck with the head and color of Slowpoke.
As of demo 1.6, this is decided by the order in which the Pokémon are selected, but I'm thinking of making it so that the Pokémon with the highest level decides the body and the other decides the head/color (or vice-versa)
Shininess is retained upon fusing, no matter which base Pokémon was shiny.
Type
Type is determined according to the first type of the head/color Pokémon and the second type of the body Pokémon (first if it only has 1 type)
If the two types are the same, then it will be single-type.
Here are a few examples to help you visualize it better:
Bellsprout (Grass/Poison) + Mr. Mime (Psychic/Fairy) -> Bellmime (Grass/Fairy)
Kadabra (Psychic) + Zapdos (Electric/Flying) -> Kadados (Psychic/Flying)
Geodude (Rock/Ground) + Mew (Psychic) -> Geoew (Rock/Psychic)
Tentacool (Water/Poison) + Zubat (Poison/Flying) -> Zucool (Water/Flying)
Zubat (Poison/Flying) + Tentacool (Water/Poison) -> Zucool (Poison)
There are some exceptions. Normal/Flying types are considered single-type Flying, Gyarados is considered single-type water and the Ghastly line are considered single-type ghost.
Level
As of demo 1.6the fused Pokemon is the same level as whichever of the base Pokemon was highest level.
However, I will likely change this to make it work in the the way Raoul_D suggested in
this post.
Abilities
A fused Pokemon gets the first ability of either base Pokémon.
Stats
Stats are an (almost) average of the stats of the two base Pokemon. They are calculated in the following way: (poke1 + poke2) / 1.75
I chose to divise it by 1.75 instead of making it a true average so that fused Pokemon have a slight stats boost without them being too OP.
Movesets
A fused Pokemon gets the full movesets of both parents.
So Blastizard will learn Hydro Pump at level 60 and then Inferno at level 62.
Evolutions
Each halves evolve separately.
So for Squirtle + Pidgey, you'll get:
Squirtgey -lvl16-> Wargey -lv18--> Wareotto -lv36--> Blasteot
Same thing with Pokemon that evolve with stone.
As a note, trade evolutions now evolve at level 40.
IVs
Average of both.
EVs
All EVs of both are received.
Breeding (not done yet)
When breeding two fused Pokemon together, the offspring has chance of being any combination of the Pokémon composing the parent Pokemon.
Let's say we're breeding Squirtle+Rattata (Squirtata) with Charmander+Psyduck (Charduck), the offspring can be either:
Squirtle, Rattle, Chartle, Psytle,
Squirttata, Rattata, Chartata , Psytata,
Squirtmander, Ratmander, Charmander, Psymander,
Squirtduck, Ratduck, Charduck, Psyduck,
The actual probabilities haven't been decided yet, but I'm thinking on basing the whole thing off
Mendelian inheritance
I will likely add items that the parents can hold, similarly to the everstone for natures, so that the probabilities can be controlled.
I think that about covers it. Let me know if I forgot anything.