I very much doubt the name change was because Prometheus was "terrible". While financial success has no bearing on a film's quality; for the studios, financial success is all that counts. It made a decent amount at the box office. I would guess if the studio had their way, it would have just been called Prometheus 2.
Just seen now, that there have been suggestions that Scott was not too happy with the idea of Blomkamp making an Alien film. First he insisted Prometheus 2 should be made first, and now the title change from 'Prometheus' to 'Alien', is possibly some attempt to dissuade Fox from letting Blomkamp's film happen. Not only that, but he (Scott) is intending to release more films, that will almost certainly carry the 'Alien' title.
I hate to say it, but I think Blomkamp's film might well be shelved.