Yes, except there's a business partner exemption to the prepaid thing.
The way it works is, say you're a store. You give out prepaid cards or coupons or other examples of closed-loop virtual currencies. People come in and buy, say, candy bars. You take their coupons and prepaid gift cards, and then you turn around and give real money to the guy who sold you the candy bars. Or to your landlord. Or to any other vendor or service supplier.
This routinely happens with branded virtual goods in video games. Say FarmVille has a deal with Dominos where you can use in-game tokens to buy real pizza from inside the game. The players still have to pay money for the tokens (though sometimes they can win them as prizes), and Dominos gets a cut of that (usually 70 percent with Facebook and Zynga games) to pay for the actual pizza.
But you have to be a real business partner, not just an average joe-off-the-street in order to be able to cash out. And the relationships are business-to-business, not player-to-player. I.e., Dominos doesn't have to create an in-game character to collect the money. (Well they can, to get in the spirit of the game, but it would be part of the game environment, an NPC, not a player character.)
So if Linden Lab switches to a closed loop currency, I think the large land barons would be okay. Unless the Lindens decide to drive them out of business, as well.
I'd guess that small merchants and landlords are likely to suffer most.