Originally Operation: Prometheus was supposed to be, as you just said, Manuel's creation as a Spartan II for the PMC.
But as you already mentioned, that's a near impossibility. I'll find a way to make the Project fit in, even if it's purpose changed so dramatically.
Wait... remember Troubled Minds? When it was revealed Death was working with a certain someone to do a certain something. Perhaps that could be Project: Prometheus. I dunno just yet.