As long as your whole game code is inside a single structure, you can use pretty much whatever you'd like from the tools/engine that you're using - so yes, prefabs are allowed! Things that come out of the box can be freely used/referenced to - eg: in Unity, you can do operations with RigidBody or Sprite or whatever, but you can't write a "struct Player { Sprite; RigidBody; }" to help you organize things.
The whole thing is not really about making it hard, or even making it challenging necessarily. It's more about having a sandbox for people to react to the whole "single code unit" concept: do they reduce scope? Do they write unreadable code? Do they pick a specific challenge within those constraints? Do they simply go for a non-oo language? etc