Yes, each of the peers in the MNet network can use its own authentication method. Just make sure that every user has its single "home" server where they log in. Since they are authenticated at their home server (against LDAP, AD or whatever), they can roam to other MNet hosts via SSO.
What MNet does not support is the scenario when both Moodle A and Moodle B share the same auth source (eg same LDAP). Then they can't be put into the MNet network easily - just because there is not that single home server for each user.