from www.tmz.com -We have more info on Carrie Prejean’s abrupt about-face during the settlement negotiations with Miss California USA lawyers — when they showed her the X-Rated version of Home Alone … starring Carrie herself.

When the video started playing, Carrie’s first reaction was “that’s disgusting” … and Carrie denied it was her.

Then, the camera angle changed … and panned up to her face. She was caught red-handed … so to speak.

Carrie was rendered speechless and immediately began talking with her lawyer. We’re told it took about 15 seconds for Carrie to drop her $1 million dollar demand.