Actually, this could be good. If you put a ham block between two bread loaves with the toolbox, perhaps you could get 4 ham sandwiches out of it. Maybe it could restore your health a bit better than just regular bread or ham?
But i think it should only be used for baiting. If you just carried a bunch of these and broke one whenever you got hurt, the game would be too easy. Maybe if you smash a ham block you get unedible rotten ham?