Seems pretty silly to me. The prison banning Dungeons & Dragons, that is. I just can't see how a game like this is going to encourage gang activity. If anything, Dungeons & Dragons might be quite a productive use of the inmates' free time, since it constantly engages skills such as creative thought and mathematics.
Or maybe the guards are simply afraid that the prisoners are going to use Dungeons & Dragons as a "gateway" to some legit black magick!
Worth noting again that Gary Gygax, the creator of Dungeons & Dragons, was a devout Christian. Bet he wouldn't have any problem with his game being used like this.