When a friend on mine was an agent for the FBI he was required to fly with his service piece. They're essentially Air Marshals when they fly. So yes, federal law enforcement will have their weapon on them. The only difference here is that you were able to identify them as law enforcement due to the prisoner.

As far as flying with prisoners on a flight, I've done it multiple times and it's pretty much as you describe, except for the uncomfortable part. I'd be more worried about one of the other passengers causing a disturbance or one of the ESAs on the flight causing a problem.