I am the co-Founder of Fairlay.com a yet still centralized prediction market.
However, we started working on the site (little bit more then a year ago) because we are obsessed by PMs and blockchain tech. Our approach has been to set something up running and we will decentralize the underlying mechanics (money storage, order book, resolution) step by step.
Thus we follow everything what is happening in this space and will use services as soon they could replace a part of our site. (like realitykeys, multi-sigsolutions,...)
A presentation about the current state (from our view) of decentralized PMs is given here:https://www.youtube.com/watch?v=hZO1JQtMang
I don't think that it contains really new stuff for member of this board...
If truthcoin would exist we would not hesitate to build on it.
Our general status - we have around 1700 registered users (even if it is not necessary to register). We had the most prediction volume during the last 2 weeks of the FIFA World Cup even if we build our site with mainly predictions on politics and Bitcoin related events in mind. We all know that a betting exchange like betfair or a PM like intrade have the same underlying mechanism but they still attract different user. In the end user used to sport betting still found it easier.
That been said - from our experience so far our main obstacle is user not understanding the site and not being not decentralized.