Well, according to the PRU Peace Event file, the script I've cut and pasted here seems to indicate that the event only checks whether Prussia controls Berlin, Konigsberg, and Warsaw...unless I'm missing something. I haven't checked in a while, but I'm willing to bet anything that their morale is below 75...their entire army has been essentially destroyed....
Also, the year is 1807, meeting the date requirement, obviously.
StartEvent = evt_nam_PRU_PeaceOfTilsit_PRU_On|1|0|NULL|NULL|NULL|NULL
MinDate = 1806/01/01
EvalEvent = evt_nam_FRA_PeaceOfTilsit_PRU;>=;1
SelectFaction = PRU
EvalRgnOwned = $Berlin;NOT
EvalRgnOwned = $Koenigsberg;NOT
EvalRgnOwned = $Warszawa;NOT
EvalIsAtWarWith = FRA
EvalMorale = ;<;75
EvalMorale = ;<;FRA
SelectSubUnits = Area $RecruitArea_Prussia;$Land;Enemy;
EvalSubUnitCount = >=;75