Thren - I assume you have seen this on Seachem's website...
I have gone back and forth on this as well. This isn't the most detailed of responses. If what they are referring to is just the difference between NH3 and NH4 then saying its a false positive is totally misleading. But I'm not convinced that is what they are saying. I actually posted on Seachem's forum asking for a more detailed explanation. Unfortunately I haven't received a response yet. So I started doing some of my own digging. I haven't found anything that I would point to as concrete scientific evidence, but I did find some info that is interesting and that I need to look into more. So Prime contains something called sodium thiosulfate (or some derivative of it that allows them to call it proprietary). Apparently the sodium thiosulfate can have a reaction with the chloride ion that is part of the test reagents and this can result in a false positive. Again I'm not 100% sure of this but so far this is what I have come up with. I would be happy to make this another scientific topic for us to explore!
In addition I have also seen actual situations where it would appear that prime was giving a false reading. Tank appears to have gone through the cycle but for some reason low levels of ammonia are detected. Person is dosing prime to detoxify the ammonia. Once they stop dosing ammonia goes away. You have see this thread before but for the benefit of anyone else reading this.....
http://www.aquariumadvice.com/forums/showthread.php?t=302203
Back to the OP here...out of curiosity how often are you dosing prime? What kind of filter are you running? If it's not the prime and there is actually .25 of ammonia in your tank I'm struggling to figure out what could be causing it.