Does anyone know of a way to block discounts from an order if a specific item is present on the order?

If you're familiar with scripting: You can write a client script that validates each line. If the line being added WASNT a discount, it would allow the line to be added. If the line being added WAS a discount; The script would loop through all the other lines, checking for the specific item. If that specific item was on the order, a pop up could be thrown that says "Cannot Add Discount if [specific item] is on the order" and it would prevent the discount line from being added.

Thanks Eric, could this work on sitebuilder also?

I'm not 100% on that. If sitebuilder allows scripts, I think it should work. But that may be limited to suitecommerce advanced only(?)