My fiancé is incarcerated and unable to cash out his 401k, will POA allow me to do that for him?

Call the company that holds his 401k. Ask what he needs to do to cash in the 401k. It may be just some paperwork he has to fill out. If he has a bank acct the money can direct deposited.

Call the institution and ask. Some have specific rules and even their own forms for that purpose.

Your POA may not work. Is the POA activated now or does it require him to be found incompetent? Read it.