I wonder if there are tax implications on the seller's (either retailer's or further up the sales chain) side which make the "instant rebate" form more attractive?

Given that one of the appeals of rebates over cost reductions is that there's some float on the rebate cash, perhaps with instant rebates there's some "float" on the item that the manufacturer holds until sold? Because the other appeal with rebates - that not all eligible customers will actually bother to redeem them - won't be the case with the "instant" variety...

To me, the difference is subtle but real.

If you see something on the menu like $10 off on Thursdays, or BOGO, that becomes the price of the item. (Your $29 entree is now a $19 dollar entree), or in the case of a BOGO one will be listed on the bill under some variation of $0.

When you order a meal and present a coupon, the coupon becomes your form of payment, not a discount on the price. In the example above, if you had a $10 coupon, the price of the Entree is still $29. You PAY the total bill using your $10 coupon as part of the payment.

Do you tip on any of the taxes, fees or duties that are included in the items, but are not listed as sales tax? If not, hmmm...

This depends on the state.

I've done this in California (for sales tax calculations only) and had the waitstaff argue. it's not worth it if it's a dollar or 2 esp if the waitrons are stupid which they typically are.

Also the whole 18% tip destroys the whole concept of tipping for service but is not necessarily illegal or against the rules.

In California sales tax is collected by board of equalization.

http://www.boe.ca.gov/pdf/pub113.pdf

If the coupon is "third party" e.g. (manufacturer) sales tax is charged on the full amount. If the coupon comes from the restaurant itself I would say it's not 3rd party and sales tax should be charged on the discounted amount.

I am sure this could be argued but the entertainment and restaurant.com coupons don't seem to be 3rd party.