I don't believe these are entirely accurate.
1) The Rice survey regarding profitability of deals is based on anecdotal data only (it didn't crunch the numbers on the deals offered). The circumstances under which Groupon deals are profitable for merchants are very narrow and often difficult for merchants to measure, as they require tracking customers and referrals carefully over a period of months. How many businesses do you know of that could cut their prices by 75% (50% off list + 25% to groupon) and survive? Put another way, how many businesses have net margins > 75%? Answer: none. The profits to merchants are a mirage, as it's really future sales sucked into the present at a discount, not incremental increases.
2.) Not quite true. The current financial statements reflect the presence of breakage (for international), which is why the CityDeal acquisition actually saved Groupon's ass. The merchant agreement in the US says that unredeemed balances are split with the merchant after 60-90 days. Also, a customer's LTV goes down if breakage becomes too high--when customers don't use the coupons they buy, they tend to stop buying them.
3.) The latest numbers in the S1 show that the "backlog" of merchant deals in the US awaiting scheduling dropped in the most recent quarter. Given that Groupon has 900 employees in the US alone calling merchants all day every day, that's not a good sign. Sure, there are plenty of local businesses that haven't run Groupons yet. But that doesn't mean they haven't worked with a competitor or that they are good potential targets. Remember, Groupon has deliberately (per the S1) not repeated offers from the same merchant, and the pool of attractive restaurants/merchants is getting thinner. A 50% off coupon to a crappy restaurant isn't worth much if no one wants to eat there.
4) This is actually less true than you would think. Per the Deloitte annual restaurant surveys, food + labor (known as "prime costs" in the restaurant business) equal about 60% of revenues across all of the types/sizes of restaurants surveyed. These costs are largely variable, as it's easy to cut a server's hours on a weekly basis or put food in the refrigerator for a day and order less for the next delivery two days hence. Unlike hotels and airlines, where once the airplane takes off or once the hotel is built, there is no ability to easily adjust supply and significant costs are incurred to provide service to empty seats. Regardless, restaurant net margins (per the same annual study) are in the 7-10% range. Which means that a 75% discount to fill the empty seats would still be unprofitable.
5) Even if all of the above were true, that doesn't make it a good investment at the likely offer price. Assuming the offer price is $10B, the only question is, "if I had $10B in my pocket and someone offered me the chance to buy the whole company on the spot, would I take it?" Buying a single share at $10B/[shares outstanding] is the same question. Personally, I was eager to short it at $30B. (Sadly, the speculative bloom is off the rose, so while I still think it's a short, it's not a screaming short.)