I would really hope that they stop making the updates and concentrate on working and finishing Grand Turismo 5.

because GT kicks some much Ass that they can release a DEMO and sell it for people and 3 mil+ people would buy it. Easy Money

What everyone has already said in his thread!!!

they know the have a money cow and want to suck the tit until it is dry.... more seriously though probably to cover dev costs nd to keep it fresh in fans minds until whenever t 5 is ready

It's essentially releasing a game in mid development cycle to satiate the lips of fans. Everything going into it is being developed regardless. If this were a different genre, it would look something like releasing the first 1/3rd of the next Zelda game as a retail package. To keep it in the Sony family, it's the equivalent of the $40 SOCOM and Warhawk titles if it was under full knowledge a larger, more robust experience was going to be created for $60 in the future that would feature everything from the incomplete package plus more.

Essentially, GT5 Prologue becomes a worthless paperweight the moment Gran Turismo 5 releases. It's genre allows what other games would get crucified for trying.

Money. Period.

Because it helps them pay for the full version of the game, and they need a filler game to keep the fans happy

I dunno, but they need to make an epilogue!

 So Sony can charge suckers for a demo, get feedback (mostly "where is the damage? why are the trees made out of paper? why is the AI still retarded? why do they still use the same tire squeal noise from GT1? etc...") so they can tell everyone the final game will have all that stuff fixed, then delay the game another year to redo it from the ground up.

Small correction I bolded. You're describing a beta, not a demo.