My book states Prairie falcons eat birds and small mammals. So that would be normal food for them. Merlin are more bird and flying insect eaters and don't tend to go after non flying prey.
As to whether it is cross bred, that I can't say. It may be or it could be variation due to the expansion into less arid territory. Prairie falcons are known to be widely vagrant, as far east as massachusets for example, when their usual territory is west of the rockies and extends to the high plains for wintering. You aren't that far out of their marked breeding territory so it is possible you have seen a pair exploring for new territory. Remains to be seen whether they will be successful or if it will be a failed expansion of the breeding area.