Actually, I recall reading a very interesting article about this.
The Power Loader was, in fact, a fully functional machine. The one designed for Aliens did work on its own, though it was far too inefficient for any other purpose than filming. It moved using a combination of pressure sensors and hydraulics, though I believe it was disassembled after the movie was finished.
"If anything in this life is certain, if history has taught us anything, it is that you can kill anyone." - Michael Corleone