Mutants and Masterminds 2E uses the standard d20 system definition of Prone, as follows.
Prone: The character is lying on the ground. He suffers a –4 penalty on melee attack rolls. Opponents receive a +4 bonus on melee attacks against him but a –4 penalty on ranged attacks. Standing up is a move action.
3E and DCA use a similar definition:
A prone character is lying on the ground, receiving a –5 circumstance penalty on close attack checks. Opponents receive a +5 circumstance bonus to close attack checks but a –5 penalty to ranged attack checks (effectively giving the prone character total cover against ranged attacks). Prone characters are hindered [1/2 movement]. Standing up from a prone position is a move action.
Both systems include a feat called Prone Fighting which removes the melee penalties to attack and defense, 2E also adding the ability to move at half speed while crawling instead of 5' per round, something standard in 3E Prone with or without the feat.
So, as can be seen in the description, there is nothing that prevents a flying character from being Prone, or having the Prone condition applied to them (in fact, in 3E, the Affliction power includes Prone as a 2nd tier effect). What should happen then? I know D&D 4E clarified that a flying creature rendered Prone is defined as crashing into the ground. And apparently, the 3.5 D&D Rules Compendium stated that "A winged creature can be tripped, and if it is, it falls as if it didn't maintain its minimum forward speed". I don't think either automatically applies to Mutants and Masterminds.
Related, should a Flying creature still have to spend a Move action to remove Prone (or use Acrobatics or Instant Up to do so as a Free action)? Does the answer change for Burrow or Teleport?