I missed this but it looks like last week Prism 0.9 was released and it added functionality that enables it to run as a Firefox plugin so you can quickly and easily turn any site into a Prism application. They also added functionality that lets you detect embedded "bundles" (packaged Prism applications) and prompt the user to install it.
The new version also has some helpful features and is using Firefox as the runtime so you don't actually have to download the XULRunner runtime to use Prism apps:
We separated web applications into isolated processes, with isolated profile data. Web application icon support via favicon or custom image. You can now choose the image used to represent a web application on the desktop. We also added some platform specific features. Some, like “popup notifications” (all platforms) and “dock badging” (OS X) can be used via a custom webapp.js (more in a followup post). Others like “minimize to tray”, are not quite ready on all platforms. So we are holding off exposing those until the next release. We fixed a lot of bugs and probably added a bunch different ones.
In some ways it seems like Prism is being more closely tied to Firefox and the features are still browser-centric in some cases. I think it's great to have so many different kinds of Desktop RIA options and I think that AIR and Prism definitely aren't competing for the same type of developer at this stage. That may change as Prism expands, but right now Prism seems targeted at the minimalist desktop RIA while AIR is aimed at providing a very separate desktop/browser experience.