I can only speak for what I saw done first-hand. Some guys used their own shanks/shivs/whatever you want to call it, basically any old piece of metal. This was obviously done in their cells on their own. Much more frequently [and out in the open] though was guys using the plastic butter "knives" that came in the dinner trays (think KFC, individually wrapped sets of 1 plastic spork, 1 wetnap, and 1 plastic butter knife with a kinda serrated edge - though still dull as all hell). For doing the divots we used the end-tip of the long piece on the cap of a typical old-school style Bic pen - this worked extremely well and quick.

you had bics? like these?

http://webcuriosita.it/wp-content/uploads/2018/01/penna-bic....

at school we used those as dices directly, notches on each of their six sides, making them roll in a bunch was random enough.

Close, but they were more the "older" style Bic pens from WAY back in the days. These:

http://www.bonvan.com/images/up_images/officepen/229.jpg

The end of the piece that sticks out from the cap worked just like a tiny plastic shovel

We carved our own knives out of bars of "state soap" .

Who carved the first soap knife and what tool did they use?

It's bars of soap all the way down.

toenails

whoosh