A staggering 127 state prison inmates have been caught stealing unemployment pay while behind bars in the past three years, labor department officials revealed yesterday after days of Herald inquiries — then admitted some of the cases were never passed on to the Attorney General’s office for prosecution. The Herald began inquiring about prisoners pulling jobless pay after a front-page story Tuesday reported that Kevin Smith, 42, of Mattapan, a laid-off construction worker and convicted robber, scored $58,000 in unemployment dough while serving a two-to-three-year prison sentence at MCI-Cedar Junction.