Greg,
I assume you have been working with the source code shipped with the SDK?
Getting Workspace loaded as an AIR application is relatively easy if you have no need for forms that use PDF/Acrobat technology (e.g. Flex forms). If like most customers you need PDF forms, its a whole lot harder because when we load Acrobat Reader its not actually docked in the Flex application (even though it looks like it is), its actually positioned over top of the Flex application in an iframe. The Workspace flex application communicates with the iframe and Acrobat using Javascript loaded in the HTML wrapper. AIR's native web support is promising, but leveraging it will take a lot of work at this point.
Good luck!
Matt MacKenzie
Engineering Manager, LiveCycle Process Management