TL;DR: Prayer doesn't stack unless the Skill Levels are the same, the highest level Prayer goes into effect even if it doesn't heal the most. In the future modders might want to avoid easy access to "Level X Prayer on Equip" where the X doesn't change. Alternatively, don't use the "hitpoint" stat, which seems to be the source of the issue. Use the "hpregen" stat instead (hpregen set to 256 heals 25.0 HP/sec).
There's a long-held rumor that Prayer from multiple sources stacks, so I decided to test it. Note that you can stack healing auras as long as they don't match (i.e. Prayer + ResFire + ResCold + ResLtng + Cleansing + Meditation), this was intended in HUv1.7. This test is only for the case of Prayer + Prayer. In HUv1.7 Prayer heals 3% of your Max HP +0.5% per level (e.g. Level 20 Prayer = 3% + 20*0.5% = 13% of your MaxHP per pulse).
My test setup was with three characters. Two characters (Trappy and Petter) had Prayer Mercs and the third (Thorny) was a Paladin using Prayer. I'd load up some character with cheaty-charms so their HP were very high, I removed their ReplenishLife gear and got them beaten down to about 5% of their HP. Then I'd take the beaten char to a WP (ColdPlains) where a couple Prayer auras would come into effect and I noted the HP between pulses. My first test was letting Petter get healed by two Mercs, then with his Merc killed off I let him get healed by Trappy's Merc, then by his own Merc alone. My last test was with a Paladin running Prayer and being healed by himself and Trappy's Merc. I was running the game in windowed mode (minimizes when window focus is lost), so I typed into the game chat and later transferred it to a spreadsheet.
TrappyMerc - Lvl 26 Prayer (16% of 1063HP = 170)
PetterMerc - Lvl 15 Prayer (10.5% of 700HP = 74)
ThornyPrayer - Lvl 9 Prayer (7.5% of 2552HP = 191)
This table shows the cheatingly high HP of some character as they healed under the influence of the Prayer auras mentioned in the column header. The number above the header is an average HP healed by the pulses (note for PetterMerc, he was taking some minor damage between pulses. In a retest, consider loading up with -PDR/MDR gear).
Code:
~170 ~170 ~74 ~170
TwoMercs TrappyMerc PetterMerc Thorny+TrapMerc
5870 1857 3739 707
6040 2027 3806 877
6210 2197 3875 1048
6380 2367 3949 1218
6550 2537 4020 1388
6721 2708 4090 1558
6891 2878 4163 1728
7061 3048 4237 1899
In a later test, I used two new non-geared Paladin characters (P1 and P2) each with Level 1 Prayer, where one of the auras healed 15hp and the other healed 5hp. I got P1 beaten down and noticed that the Prayer of P2 healed 5hp, then activated P1's Prayer and noticed that for the next 4 pulses he healed 20hp. I repeated the test after maxing BHammer (reduces pulse interval on Prayer), and found that the Prayers still stacked (P1's would heal +15hp then soon after P2's would give +5hp). I raised the level of P1's Prayer to level 2, and the stacking effect stopped.