I do not believe that ethanol is mandatory. You surely need a proton source, but that's why those reactions are performed in protic acidic media, like your first example, with HCl, or what I think were the original conditions of Bechamp reduction, using acetic acid.
Probably ethanol makes a good solvent for phenol rings.
Edit: this is the Bechamp original paper. I couldn't manage to find it in English. I'm not French speaker either, but just in case you are curious :-)
As far as I'm concerned, nowadays catalytic hydrogenation is used to perform this reaction (at least at industrial scale)
About the mechanism, I'm sorry but I can't give you a solid statement on this.