We learned that vendors in Multi-Vendor aren't able to create coupons codes. It seems CS-Cart designed it so when "Vendor A" creates a discount code it applies the Vendor A discount to Vendor B's products at checkout as well. So, if you have a cart with multiple products from different vendors a coupon code created by one vendor will work on all the products at checkout.
Obviously, vendors shouldn't be able to create coupons for other vendors. With this design a sneaky vendor could create a "100% Off" coupon and purchase everything in our marketplace for free.
CS-Cart support said vendor coupons will work correctly with the Direct Customer to Vendors Payments addon enabled. Although, that addon means buyers need to check out from every vendor individually instead of checking out once for all products from multiple vendors. Modern Marketplaces haven't worked like this for over a decade and it sounds like a bad buyer experience to make someone check out multiple times when purchasing something from one website.
I would like to propose CS-Cart fix Promotions so that if a Vendor creates a Discount Coupon it will work only on the products within that vendors catalog and not on every product in the marketplace.