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Sorry but in the northeast all the prison TRUSTEES have TRUSTEE in big letters on their jumpsuits.

Additionally, you will note that the word "trustee" does not in fact give as a definition anything to do with a person holding a position of trust in a prison.

Doesn't it?

Trustee is also a term used for a prison inmate who has special work-related privileges, usually as a result of good behavior.

Google references to "Trustees"

Answers.com

Doesn't it?

No, it doesn't. Below are the three definitions for the word "trustee" in the Merriam-Webster online dictionary that NoCmpromiz provided the link to:
1 a: one to whom something is entrusted b: a country charged with the supervision of a trust territory
2 a: a natural or legal person to whom property is legally committed to be administered for the benefit of a beneficiary (as a person or a charitable organization) b: one (as a corporate director) occupying a position of trust and performing functions comparable to those of a trustee
3: trusty

As I had pointed out, the third definition simply links to the word "trusty" elsewhere in the dictionary, where it is defined as "a trusty or trusted person; specifically : a convict considered trustworthy and allowed special privileges"

Trustee is also a term used for a prison inmate who has special work-related privileges, usually as a result of good behavior.
If you want to trust (no pun intended) Wikipedia as a source, you should also read the Wikipedia entry for "trusty."

Google references to "Trustees"
There are 548,000 results returned for your Google search of the phrase "define prison trustee." However, using the phrase "define prison trusty" gives 7,160,000 results. I think that pretty much shows which spelling of the word is used more in this context.

Answers.com
Thanks for providing this link to the definition of "trusty," which completely supports my position.

So let's go back to your original posting, which was: "The newsie should know that's 'trustee' not 'trusty'." I think the dictionary, Google, Answers.com, etc., pretty much prove that the "newsie" knew what he was talking about.