It's much more than just the ___domain name in this case, but also trademark and registered business name. Basically Groupon might not be able to operate as "Groupon" in Australia, regardless whichever ___domain name it uses.

No. It was LivingSocial who invested $5 million on JumpOnIt, which is one of the larger group buy site. LivingSocial themselves took funding from Amazon.

Scoopon (and the guys behind Scoopon and CatchOfTheDays.com.au) also registered other ___domain names such as Woot.com.au and DealExtreme.com.au. So I think it's a pretty trivial squatting case.

Well, the price stayed the same but they had given you 20% more RAM a bit over 2 years ago (http://blog.linode.com/2007/12/23/20-additional-ram/) and 33% more disk space less than a year ago (http://blog.linode.com/2009/04/23/33-additional-disk-space/).