Terry, I'm inclined to think it's not a blockage that's killing the fish for a simple reason: The gut is empty. While a blockage in the intestine would certainly prevent the absorbtion of food, you should see undigested matter in the stomach, an overabundance of which would explain the lack of appetite. That doesn't seem to be the case here. I'm kicking around two possibilities in my head:
First, that the sand particles don't block the intestines, per se, but irritate them to the point that the fish does not want to eat. Similar to a human with a stomach bug. Unfortunately, the body is unable to pass the particle and the fish wastes away. I think this is unlikely, however, given that ingesting sand is probably something these animals do in the wild on a regular basis.
Second, a reaction between the stomach acids and the sand is either damaging the stomach lining and intestines, or irritating it to the point that the fish loses its appetite. The fish was apparently living in an aragonite sand bed in captivity. From the limited information I was able to find on the geology of the region, it seems like the sea floor in the Sea of Cortez would be mostly made up of silica and volcanic sands. Remember, aragonite is made of CaCO3, so a strong interaction with stomach acids is possible. The part of this theory that gives me pause is that the yellow-headed jawfish is a Caribbean species which we don't see this issue in. however, the Caribbean jawfishes may have evolved to deal with the interaction of acid and base in their stomachs.