Specifically - Sparrow was the name of the Prototype Atari gave to developers before Falcon was finished. I believe that the name for the Falcon Project was Falcon (it sounds code-namey to me). I saw a prototype Falcon in Atari ST User back in 1992, which was much like a production Falcon except the case was darker and the 'Atari' lettering on the badge was all in red.
The Sparrow was sometime known as something like 'Atari FX-1' and said so on the badge. It had video circuitry much like the Falcon's and I believe an 030 chip, but I dunno if it had Videl. I think it had a DSP tho. The Operating System was a kludged version of TOS 2.06 to support the new features, but it ultimately wasn't compatible with Falcon software.
They turn up on eBay from time to time, and go for silly amounts of money.