And if so, why did they do it, other than for punishment? It's a common theme in old movies and cartoons that prisoners break rocks for hard labor, but why would they do it? Surely there were machines that could do the job better, even before the modern era.
In terms of Victorian Britain, this is indeed true. If you were an able-modied male prisoner, you could be breaking stone for something like 10 hours a day. This stone was then used in construction projects. This link goes into a little more detail on the subject. Other tasks were more more time-consuming than productive, like constantly turning a wheel all day.
Nelson Mandela and his fellow prisoners worked in a lime quarry durring his imprisonment on Robben Island (as recounted in his autobiography).
Yes there would have been labor saving devices available, but the point wasn't production, the point was to keep the prisoners busy and too tired to escape, riot, or anything like that.