Was just working earlier this week on a little AIR application for my own use and I got stumped at one point while using it. The AIR application makes use of the local database and I was unable to update a record; I was repeatedly getting error 3122 during the save operation. After looking up the error description I figured out it was because the database file was read-only. It was because the file was in the application directory, also note this is on Windows Vista (I don't need to tell you about UAC!). I made the file modifiable, but now was getting error 3125. Error 3125 states that the OS simply won't let you update the DB in any way, and I figured it was Vista not letting me do the update. So I moved the file to my documents directory and it worked fine.
So be careful during an installation of a mission critical AIR application, make sure you place your database file somewhere where it can be worked with; either in the user's document directory or in the application storage directory. Especially important on Windows Vista.