I haven't checked it myself, but from the recent discussion with Diego Queiroz I conclude that the name 'PATH prefix' from LyX preferences is misleading, because it is evident that PATH isn't prefixed by it.
Instead of changing a name, I'd rather change the behavior of LyX to really prepend the PATH instead of appending to it - otherwise there are conflicts sometimes (like with the ImageMagick 'convert' conflicting with system 'convert' utility). Regards, MichaĆ