I'm also going through the same thing at the moment, my 16 month old son has a very strong will and gets upset so quickly sometimes and it can snowball quickly too!
I've only given time outs a few times when i feel that i honestly don't have the patience to stay in the same room with him! A few months ago when his temper tantrums started a friend of mine said that love love love is the keyword, and I did not believe her! I was sick and tired of the way he reacted and that I couldn't handle it, or didn't know how to handle it. A LOT of patience from my side, proved her right
The moment you get your own temper under control it is a thousand times easier to deal with your child. When he gets upset about something and it turns into a full scale tantrum, I always firstly calm myself, breathe, and make sure i don't raise my voice or sound upset. I stay very firm, if it's no, it's no! (keeping in mind that i don't say no for everything, i generally let him do things that don't put him or other people or my things in danger - even if it means that i have to leave what i'm doing for 2 mins and do it with him) But when he does throw a tantrum I go on my knees infront of him so that i'm on his level, then when i speak to him, i his face in my hands gently to be sure he's looking at me, and after i've said what i need to say, i put my arms out and when he's ready for me to hold him, he'll come to me. I get what you're saying about not rewarding bad behaviour with cuddling, but at the same time, i feel that they experience so many negative emotions when they throw tantrums, mostly they are really very angry, and when you are angry, you always feel better if someone just understands and loves you.
this is a lifelong journey of LEARNING, for us and them.
be patient, you'll find what works for you and your child, but don't expect it to happen over night.