A kilogram of bread is about 2000 calories, about 9 kJ. Your body “burns” food too - probably more efficiently than you could make a steam engine for the same, but it’s about that much.
Energy from gravity is equal to mass * gravity acceleration * height. 1 kg of bread in a 9.81 m/s/s field has the same gravitational potential at “about a kilometer”.
If you’re throwing magic stake baguettes off the top of the Burj Khalifa, the energy would be about equal.
True. I’d mentally envisioned it as a whole series of “bread powered water wheels” down the side of the building, with a furnace at the bottom. Nothing actually going fast enough for friction to matter. A machine that only tried to convert all the kinetic energy at the bottom would be wasteful, as you say.
Plainly, we’re going to have to put some engineering design time into the concept of this.