Considering what Mosley did to Margo afterwards I would say Mosley was still prime when they fought.
No he wasn't.

When a top guy ain't what he used to be, there's a saying that all Great fighters have one last Great fight in them, and for a past it Mosely, the Margarito fight was his.
For $#!t's sake, before Margarito, Mosely was clearly outboxed by Mayorga until scoring the hail mary KO right near the final bell. Outboxed by Ricardo Mayorga, for $#!t's sake!!! Mosley was a bit past it when he fought Cotto.