I mean, if we look at the punishments for crime for real world equivalent period, options for them were pretty bad in most cases. Prison system is relatively modern in its wide spread useage, during the equivalent medieval period criminals would have, depending on the crime and severity, faced:
1) Fines, these were mostly for mild crimes in the eyes of society, like bestiality.
2) Physical & Humiliating punishments, these were things like public whippings, locking people in the stocks and pillory where they could be pelted with rotten veggies and such by other townspeople for duration of their punishment.
3) Dismemberment, i think everyone has heard of the punishment style where thieves get their hands lobbed off and such, also few other nasty basically similarly devastating punishments existed that didn't necessarily lead to you losing body parts but their semi-permanent disabling.
4) Forced labour, usually very hard sentence where you were sent to penal work camps.
5) Death, old societies were extremely creative in their way of dealing with hardened criminals that commited crimes that couldn't be dealt with the ways above. Won't list them here since i think everyone can use search engines to find out about them if they want to. Best sources though would be history books in libraries.
So in that regard the punishments we've seen in the game are pretty humane, but that is easily explained by the fact that they have magic and with it can actually make sure the prisoners are monitored and can't cause anymore trouble. And yes, the game world hinted that worst criminals losing their will and possibly themselves, leaving mindless body as automaton to be used for the good of the society as a repayment for their crimes. Now until game or
Vanderer clarifies, it could be compared to death sentence, since their being is basically snuffed out of existence, but leave body to work for society.