And it was the 2nd edition Lone Star book that covered this all before. (Cause you asked
)
Nostalgia:On
I knew it must have been in this one ! Gosh I remember when I tried to find the Lone Star Guide back in the day. Somehow, it never reached France, and it quickly went out of print (or whatev). I found it in some shop several years ago, when I was not playing Shadowrun anymore - but I still bought it.
I have to finish reading all the 5ed material, I have, but as soon as I'm done, I'm going to go back to some "oldies" like this one...
Nostalgia:Off
OK, so let me share a bit more about my intrigue, that might help skew the answers (and hopefully gave me some more cool tips) in the right direction. The imprisoned Halloweener Mage has just been arrested, so he is definitely in temporary custody for trial (so he is not burned out yet). He is actually the only one who knows where is a Yakusa Oyabun or Mafia Don (to be determined) now place in Witness Protection.
The runner employers actually want to extract this guy, thanks to the Info of the Halloweener Mage, to use him as leverage against his criminal organisation ("if you don't comply, the guy will reappears and testify against you...").
Back to the technical details of the Mage incarceration. I like the idea of having him wired to VR, on top of Magecuffs, as it seems a good idea to (cheaply) ensure he is harmless. However, I also want to leave the option for my character to simply infiltrate the prison and extract the information from him...
Actually, maybe they could do that by infiltering the "off line" node he is connected to ? He, he, good stuff 
ok, so if he has just been arrested (within a couple of days), he'll be Cuffed and Masked for sure (that is SOP for a mage suspect of violent crime), However, if he is turning State's evidence, they MAY be willing to cut him some slack (depending on just how earnest he seems to be!). Which poses the question: Just how Co-operative IS he? Witness Protection for a ganger means the sweet life - FOR life!
(If I was this Oyabun, I would have a team after this guy too... but to kill him! That is, if I knew enough)
IF he is turning States Evidence and is a willing participant, he might not even BE in jail, they may have him in protective custody somewhere else..... Be a real kick to the nuts for the runners if they went through all the work of breaking INTO the prison, only to find out he is being held across town in a motel. <Evil GM grin>. And, is he really THAT willing to go back to the 'thug' life after being offered a fresh start with a 'cozy' lifestyle (relative to the Ganger lifestyle) and job?? (that's up to you)
****
The only real problem with a VR jail is the fact that they would be online ALL the time (and hot simmed if I remember correctly)... Which means someone from the outside could gain access to them still (Some criminals are dangerous only for the knowledge they possess. Heads of Criminal Families are not dangerous because of their Physical characteristics, but for their mental facilities and moral ethos, things that remain intact and possibly usable in a VR setting.
Then there is the costs of VR realm itself. This is an additional cost on top of the costs of holding and housing these people, and it WOULD NOT be cheap. You have to maintain the host and its equipment, then you have to maintain the commlinks and materials for each inmate...... Which means a larger technical staff (which is more costly then just guards). And remember, in SR prison and incarceration is a Business! Lone Star wants to Churn a profit by housing these criminals! They do that by offering to house and hold them for cheaper then the Feds can do - then they actually DO it cheaper!
And by 'cheaper' doesn't mean investing Millions or Billions on Matrix tech for criminals..... It means cutting corners every where they can! It means taking the short termers and hiring them out as manual labour to the corps to package and assemble Nerps for consumers. It means taking those Lifers and contracting out experimental surgeries, drug tests, Gene therapy and products on them.....
And they can get away with all this thanks to their AA Corp status and extra-territoriality agreements.... Who says you needs real guards that you have to pay a yearly salary plus benefits to when several tracked drones armed with light machine guns and SnS ammo can monitor the hallways and living areas 24/7/365? Who says we don't have the right to harvest the organs from a death row inmate to sell for several hundred thousand to medical research? And just WHERE do you think cyberdocs go to actually practice implantation surgeries? Who and how many test subjects did it take to learn to wire that cerebral enhancement for the first time???
The Lone Star book touches on all of this (so read it FAST!!! You need the info!). It really does do a good job of laying out just how and why criminals and prison is profitable to Lone Star and just how they make their money. And the sad, scary part is, IF the rumors are true the author just looked back tot he US prison system of the 1900s-1950s, and then enhanced them!