Para mi, "es una lastima, pero ese preso es mejor muerto". Sería mejor con mas contexto.
Pero asi solamente, lo tomó como que:
1. figurativamente, porque el preso esta fisicamente muy mal, o
2. con intención de "callarlo", ya que puede declarar contra otros.
When we say AS GOOD AS in colloquial English, we are say that something is virtually a reality or on the verge of becoming one. "They've as good as won" could be said of a team that has an overwhelming point-advantage on the score board and there is only a minute left in the game. In your case, the prisoner has no chance of survival. he's AS GOOD AS dead.
In regards to the prisoner scenario - in case they were meaning he's going to get killed because he's messed with the wrong people in prison, or because other prisoners found out something about him that is not acceptable in prison, "AS GOOD AS DEAD" could be translated as "YA ES CADAVER" or "YA SE LE PUEDE DAR POR MUERTO".
For example, in a prison setting, conversation between staff:
-The gangs found out he's serving time for murdering a child.
-Wow, he's as good as dead then.