Hey Amy,
I had this problem before I was diagnosed with CFRD. I ended up losing about 20 lbs before they figured out what the problem was.
When your BS runs high consistently it means that your body isn't converting the sugars to energy (I know you probably know that). If your body stays in that mode for a prolonged period the extra sugars can start to be "excreted" through your urine, then you have to get energy from somewhere and your body starts to burn your fat reserves. You can get ketone sticks. If you either urinate on them or dip them in a sample of your urine you can tell if you are in ketosis (sp?- also not 100% if that is the exact term for it but it is close if not), all that means (in case you don't know) is that the excess sugars in your body are coming out in your urine because it is basically to much for you blood to handle. When you are in ketosis you start to lose weight.
If you get your blood sugar under control you will probably notice that you aren't losing the weight like you are now. I know that is how my experience with it has gone.
Maybe you can talk to your doc about it if you are not on insulin or anything to control your BS. If you are I would call your endocrinologist and ask them what you need to do to help regulate your sugars cause you are losing weight and on prednisone and all. I know my endocrinologist has told me to increase my insulin doses when I am on prednisone (I take insulin every meal time .. so 3-4 times a day).
Good Luck and I hope you get it all worked out.
Lindsey