I have lifted weights and done cardio for almost 10 years now, and I can say emphatically that it has had no effect on my penis size whatsoever. Off and on, I have taken various muscle-building supplements (OTC stuff like creatine and andro (which is now banned, though it's not proven it produces any negative effects, and I never had any from it)--NEVER steroids). None of those affect penis size either, though I do think they can assist in building muscle--"assist" being the key word, you still have to do the exercise.
If you are not in good shape, getting more physically fit can have some minor beneficial effect on maximizing the size your penis already is. If you have significant fat in the pubic area and lose it, you will reveal more of the shaft that is buried under fat. If you improve your blood circulation, you might see an effect in terms of stronger erections. All together, maybe this could give a guy who starts off pretty out-of-shape maybe 0.5-1" of "increased" erection length. But this is not really enlarging your penis, it's just maximizing whatever size you already have. (In my case, though, my erection was basically 11" long when I started working out, and it's 11" long now.)
One trade-off is that if you go from being skinny to being very muscular, your penis is going to [/I]look smaller than it did before. But don't let such a superficial concern keep you from getting in shape.
As for steroids, they definitely shrink your balls, I think the jury is still out on whether they also shrink the penis. They certainly do not enlarge the penis. If they did, they would obviously be more popular--more men care about growing their penises than about growing muscles. Aside from shrinking balls, the other health and legal hazards of using steroids make it a bad idea for anyone.
Finally, I have never heard anyone claim the Italian castrati were especially well hung. 7 foot tall or not, I can't imagine that cutting a boy's balls off before puberty would have any effect other than to stunt growth of the penis.