Scenario1:
1. Add GameObject and child to it
2. Convert child to prefab
3. Convert parent to prefab
4. Drag parent to Project Browser and choose "Original Prefab" from confirmation dialog
==>
Child is not a prefab instance anymore

Scenrio2:
1. Add GameObject and convert it to a prefab
2. Open this prefab and add child
3. Convert child to a prefab too
==> Child is nested prefab now
4. Drag root to Project Browser and choose "Create Base"
5. Drag root one more time and choose "Replace Base"
==>
Child is not a prefab instance anymore

Note: "Insert Base" behaves as expected

Regression somewhere between
Version 2018.3.0b12 (77f6238a7ced) <= not repro
Version 2018.3.0f1 (f023c421e164) <= repro here

Still repro in trunk Version 2019.2.0a2 (e535fdfaaf49)