If you run "cordova prepare" from your project's root, but the parent directory has a www/config.xml file, it will try to use that file instead, and fail.
Create a cordova project in /home/username/CordovaTest. Add to /home/username/CordovaTest/config.xml:
Then create an empty /home/username/www/config.xml file.
You'll get an error, as it tries to read the parent directory's config file.