My understanding is that there used to be a group of people who lived in what we call Prussia, called Prussians, but that they aren’t ethnically similar to German Prussians at all. Is this true, and if so, what happened to them?
The difference between the Prussians and inhabitants of Prussia is comparable to the one between Native Americans and Americans. The former term refers to the Baltic peoples inhabiting the territory on the southeastern shores of the Baltic Sea and the inland regions between Vistula and Niemen rivers, what corresponds to modern northeastern Poland and Kaliningrad Region (Russian exclave located between Poland and Lithuania). This demonym, first recorded (as 'Bruzi') in the anonymous document Descriptio civitatum et regionum ad septentrionalem plagam Danubii [Description of the cities and regions on the north side of Danube] dated around mid-9th century, was a catch-all term referring to the inhabitants of the aforementioned region who were divided into many smaller peoples (Pomezanians, Galindians, Sasinians, Varmians, Sambians etc.).
Prussians, despite lack of the state organization and reliance on the archaic tribal relations, were nevertheless a power to be reckoned with, and were continuously able to repel any attempts at conquest while declining any proposal to accept Christianity, quite possibly because they treated it as the acceptance of the foreign sovereignty. All military expeditions into the Prussian lands conducted since mid-9th century by Danes and since early 11th century also by Poles were repelled. The expedition of 1147 undertaken by the Masovian duke, Bolesław IV (Bolesław the Curly) not only ended in defeat, but was also followed by a large-scale Prussian retaliation. Further hostilities between the Masovian dukes and Prussians lasted for the next half a century with different results, until the coordinated Prussian counteroffensive resulted in the destruction of majority of the Polish burghs erected in the conquered Prussian lands.
In the early 13th century, the military expeditions were sanctioned by Pope and thus gained the status of a crusade, gaining a support of several Polish dukes, including the senior, Leszek the White (Poland was divided into nominally independent provinces as per last will of the king Bolesław III). Shortly after, well-organized knightly orders arrived in the region, beginning with the Prussian Knights of Christ (Brothers of Dobrzyń), Knightly Order of Caltrava and finally the Teutonic Order that received their first domain in 1226. The latter proved to be extremely efficient, quickly incorporating other orders active in the region, conquering large swathes of lands thanks to superior organization but also due to unprecedented brutal scorched land tactics and erecting the network of burghs and towns in the claimed territory. Withing several decades, Teutonic Order, initially an ally against the Prussians became a powerful political player in the region, easily challenging divided Poland.
Teutonic conquest of the Prussian land lasted for the large part of the 13th century with the year 1283 being considered as the ending cesure, as this was a year when the order knights started to operate in Lithuania. As a result of the conquest, part of the Prussian population moved east to Lithuania and south Masovia where they were assimilated by Lithuanians, Ruthenians and Poles, while those who remained largely accepted the German culture represented by the Teutonic Order composed almost solely from native Germans and the chiefly German colonists invited by the order. It is estimated, that in the early 15th century (around the time of the Polish-Teutonic War), native Prussians accounted for roughly 40% of all inhabitants of the lands belonging to them until the early 13th century, being largely concentrated in Sambia (now Kaliningrad Region) and Natangia (now the very northeastern part of Poland), where the small enclaves of Prussian culture and language were present until mid-16th century (there is at least one known version Lutheran Catechism published in Prussian) but the language went extinct in late 17th century.
Now, what was the relation of the Prussian of the Frederick the Great fame with the fierce pagan neighbours of Poles and Lithuanians? We need to return to the aforementioned Teutonic Order.In the course of several conflicts between the Teutonic Order supported by Popes on one side and and Poland and Lithuania on the other, the Order was defeated and according to the Second Peace of Thorn it lost some of its territory and had to accept the seniority of Polish kings. Having broken that agreement in 1501, Teutonic Order got involved in another war in the years 1519-1521 that ended with its defeat. Its contemporary Grandmaster, Albrecht Hohenzollern had to adopt Lutheran faiths what led to the dissolution of the Teutonic State and loss of the papal support, forcing the Grandmaster and de facto ruler of the now secular Teutonic state (that became known as Ducal Prussia or Duchy of Prussia) to become a vassal of a Polish king, Zygmunt I.
It should be noted that the Hohenzollerns were quite an influential noble house that since early 15th century ruled the Electorate of Brandenburg, expanded shortly after by the territory of New March to the east. Thanks to these familial ties, when Johann Sigismund Hohenzollern, Prince-Elector of Brandenburg, became the duke of Prussia, both states were united with the personal union in 1618. Thirty years later, according to the Peace of Westphalia, Brandenburg was granted the succession of Hinter Pomerania (roughly the part of Pomerania now belonging to Poland) that was incorporated in 1653. Few years later, using the Polish-Swedish War to his advantage, ruler of Prussia and Brandenburg forced Poland to sign the Treaty of Welawa and Bydgoszcz in 1657, effectively ending the formal vassalage. This all meant that since 1657, Brandenburg-Prussia was an independent state spanning from Lithuania into Central Germany (though divided by Danzig Pomerania held by Poland) with some additional lands in the west (Kleve, Mark, Osnabrück and Minden). In 1701, Prince-Elector Friedrich III proclaimed himself a 'King in Prussia'.
It should be noted that though the Prussia-Brandenburg and later Prussia was a territory inhabited chiefly by Germans (Brandenburg was an old Germanic territory and Prussia was actively colonized by Germans who assimilated remaining Prussians), after the Partitions or Poland in the late 18th century, more than 45% of the Prussian territory was composed of the former Polish lands with Poles accounting for almost half of its population until the end of the Prussia's existence, i.e. proclamation of the German Empire in 1871.
Thus, the original Prussians were the Baltic people that became conquered by the Teutonic Order and then Christianized and assimilated into German population of the territory or moved to the neigbouring territories, where they ultimately also assimilated. Then, the Teutonic State secularized, becoming Duchy of Prussia, then merged with Brandenburg thanks to family ties and finally turned into the Prussian state that later conquered previously Habsburg Silesia and large part of Poland and finally became a part of the German Empire. At that time, Prussians were a history long gone, not unlike Germanic peoples mentioned by Tacitus in the 1st century AD.