Really looking for an official ruling here....

We were playing this past weekend and encountered a small problem. The Prince's special ability lets the player reset his production dice to 3,4,6 whenever the rolled total is 8 or less. There's a destiny card that forces players to roll one less die in Autumn phase. Does the Prince's ability still function and, if so, how?

Yes it does.

The Prince, supposing he can activate the power, can turn the 2 colored dice into 6,3 6,4 or 4,3.

That is the way I interpreted it. If you want more rules clarifications for the To Forge a Realm expansion, there is a pdf you can download off of BGG.

The website address is http://www.boardgamegeek.com/filepage/46123

If the link doesn't work, just visit the Kingsburg-To Forge A Realm page and go to the Files section of the page.

Also, if you like Kingsburg, there is a Java version with AI opponents that you can download. And this can be played with just the base game or expansion. It is a lot of fun!!

The website address for the Java version is http://mitglied.lycos.de/thunderfall/

Again, if the link doesn't work, visit BGG's Kingsburg page. You will find the link to it the More Information section of the page under Online Play. You can also play Kingsburg in real-time on BrettspielWelt. Their website is http://www.brettspielwelt.de