Is it possible to provide an existing SQLite file with an Air installer, and have the Air application copy it out to local storage upon first execution so that it can be modified?
Or do I need to take my pre-made db and recreate it on the fly with Air on execution (store all the queries required to create the tables/data in the application)?
Turns out I have a book that tells me what to do. If you package files alongside your application, the application is installed into a folder or contains a folder (OS X? it's still really unclear how this works cross platform, whether the db goes into the app bundle or not), and that is what File.applicationDirectory references, and you can then copy right from it.
Adobe Air 1.5 Cookbook Recipe 10.12 :)