I'm sure Conservatives would disagree, because after all every decision by Harper is pure genius, but referring to Dion as "Prime Minister Dion" is another tactical error. I actually think the Conservatives had it right in the first place, wherein Harper consistently lumped all opposition leaders into a common pool, "the other guys", a characterization which put them all on the same plane.
I understand why the Conservatives have chosen this new phrasing, but in so doing, they have essentially elevated Dion. You want to raise the spectre, because you think it will instill fear, the words meant to act as a linguistic smelling salt for voters, alerting them to the danger. However, the idea fails to recognize the downside of this terminology, the Conservatives are voluntarily separating Dion for the "others". Harper isn't referencing Prime Minister Layton, he's only speaking about Dion, and this is exactly what the Liberals want.
Looking at the electoral terrain, are the Conservatives best served by narrowing the debate, Dion or Harper, Liberal or Conservative vision. I know that's what the Liberals want, so that probably means its the last thing the Conservatives really desire. Keep calling him "Prime Minister Dion", it just raises his stature another inch or two, it actually allows people to think of him in that way. I know, I know, that's the point, voters will run when the words echo through their brains, but some soft supporters from other parties, more inclined to vote Liberal than Conservative as their second choice, might also realize the stakes and say "Prime Minister Dion", sounds a lot better than PMSH. That frame works for the Liberals, it works against the Conservatives, so in totality, this new phrasing is really a net negative, especially when the earlier terminology of lumping all the pretenders together kept the NDP and Greens on par with Liberals, in terms of messaging.
I hope Harper keeps using the term, because I have a feeling the more we hear it, the more it doesn't seem so hard to imagine, the more it narrows the debate, which is actually the central key to a Liberal victory.