I can't drink him under the table, and there are a couple of other options that are in red. He won't sell it either. How can I get the coin off him without killing him and the rest of the bar?

pickpocket?

Never got the hang of it. I get a message saying to the effect that I can't pickpocket whilst being observed.

Finally managed to get it by upping CON and choosing the "drink him under the table" option.

You have to stealth and not getting seen while pickpocketing. If your "sneaking" cirlce displays an open eye and is red you got observed. It's like doing a Backstab - but instead of hitting somebody you pick their pockets.