Not really, in fact, 'The Sad Story of Henry' is a good example of how it's not messed up, but pokes fun at the running of British Railways as a whole.
Yes, it has its ridiculous moments, such as trying to push and pull an engine and its train from a tunnel, but you've got to remember that these initial three stories were made on the spur of the moment by Awdry as a bedtime story and were never originally intended to be published, so it can be forgiven. However, one good thing that came from this is that the image of Henry bricked up in the tunnel (The repainted one by Dalby, not the awful original illustrations by William Middleton! ) has become quite a famous in children's illustration, particularly here in England.
How the character of the Fat Controller is portrayed in the story though is a direct stab at the board of directors for British Rail, particularly with how he comes up with brainless schemes to rectify the situation, yet suddenly remembers of a doctor's order preventing him from working when he is asked to help!
From a railwayman's perspective, there are loads of little in jokes that are quite hilarious.
My point was more that the punishment for not pulling your weight on the Isle of Sodor is to be bricked into a tunnel 'forever and ever and ever', though he does get freed later on. Also the punishment for getting into an accident was to be made into a chicken coop. Some of the things from the books that never made it into the TV series, like the scrapyard where pretty vile as well