Hi,
IMHO, the first syntax is for use when redistributing some prefixes to BGP only.
So you are creating a new AS PATH.
The correct syntax is "set as-path tag" though, you can't put multiple AS numbers into the AS PATH this way.
See http://www.cisco.com/c/en/us/td/docs/ios/iproute_bgp/command/reference/irg_book/irg_bgp4.html#wp1147170
for details.
Regarding prepending, here is a nice explanation:
http://wiki.nil.com/AS-path_prepending_%28technical_details%29
To answer your question shortly:
Use "set as-path..." when redistributing prefixes into BGP and "as-path prepend..." when modifying AS PATH of prefixes existing in the BGP table already.
Best regards,
Milan