On my WinXP machine, AIR applications cache such data in C:\Documents and Settings\username\Local Settings\Temporary Internet Files. Therefore, while I have no other systems, you will see that AIR uses what, in its opinion, is the system temporary folder for a specific platform. (As for how you clean it up, in my case you can do it through the IE settings dialogs or other โclear unused dataโ dialogs elsewhere on the OS, so I think it looks like on other platforms.)
If this does not help, can you host your OS?