Jadefalcon: I'm not really bothered about 'merging' accounts as such, but I'm wondering if the game will install and run okay with my new account. I am not really bothered about retrieving my old character and if the account it was tied to went inactive, I'm not bothered.
As far as I know, GW Accounts never go inactive (unless you're banned I guess). If you can prove that you're the owner of said account, they should be able to give it back to you in some way.
About installing Prophecies : there's only 1 GW Client, and it downloads whatever it needs from Anet's servers. You don't need to "install" Prophecies to access the Prophecies content. All you need is a Prophecies access key linked to your current account.