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You have two ways to setup such coupon. First of all you need to go to the Admin -> Promotions -> Shopping Cart Price Rules -> press Add New Rule button and there you will get two ways to restrict the coupon usage to certain products: using Matching Products or Advanced Conditions features. It should help you.
mrbrett - We will try and add this kind of functionality in the future. Also in our next release we have added special price on a product level (not through catalog price rules). You can then create a coupon that has a condition that special price is equal to 0. Another work around, although more time consuming, is to create a new attribute that is called ‘on sale’ and to check it when creating the coupon.