I should say the service wasn't horrible - it was just so noticeable the change in attitude from when we were regular customers to 'Grouponers'. I do like the point that half the value of a restaurant is the service. Except in Chinese restaurants, my favorite one has terrible service but the food is great and it seems to add to the character of the place.
You felt unwelcome. That's horrible service, no matter the reason!
It's quite possible that they give excellent service when the customer is not using a coupon. But I'm guessing you'll never know because of how they treated you. Even if you aren't their target market (because of the cost and driving distance, etc) it's possible that you would take someone there for a business deal or date because you remembered how nice it was. (Nevermind the outside.)
They defeated the whole point of groupon: To attract new customers.