Can someone explain the difference between the use of "formule" versus "prix fixe" at restaurants in Paris? Is formule only for lunch? In other words, what expression is now current for saying special priced meal of the day?

I think they are interchangeable. Up to the restaurant?

A prix fixe is a set price, three course meal.

A formule gives you the choice of two of any of the three courses, i.e. starter/main course or main course/dessert.

Formule is either appetizer + main dish or main dish + dessert.
Usually for lunch.
Prix fixe : multi-course meal at a set price (appetizer, main dish, dessert, sometimes drink and coffee). Both at lunch and dinner.

"In other words, what expression is now current for saying special priced meal of the day?" - Menu du Jour.

Most places now offer the "formule" because people want to skip one of the courses. However, there is always a formule that includes all 3 courses as well.