User accidentally deleted a base prefab, trying to re-create prefab using its variant, prompts "Cyclic Prefab nesting not supported".

Steps to Reproduce:
1. Create a game object in the hierarchy.
2. Drag the game object to Project window to create a Prefab.
3. Create its Prefab Variant. ( Right Click on Prefab >> Create >> Prefab Variant)
4. Delete Base Prefab.
5. Drag Prefab Variant to Hierarchy, repeat step 2 to re-create the lost prefab.
6. Select "Original Prefab" on Create Prefab window(Pops up on dragging Prefab Variant Instance to Project Window)

See attached video to reproduce the issue. (RecreateLostPrefab.mov)

Observe: "Cyclic Prefab nesting not supported" window pops up.

Expected Result: New Prefab should be created.

Reproducible On: Version: 2018.3.0a2 (e9113db2e9bf)
Branch: prefabs/improved

Note:
- Appears on both OSX and Windows