Plot hole: When Freddy takes over Jesse's body at the party, there are several people watching through the patio doors when he confronts Lisa. None of these people ever make a sound, even when they see Lisa have a knife fight with a horribly disfigured man with long knives coming out of his fingers. The other party goers are completely oblivious to Freddy's presence until he comes jumping through the glass doors.
A Nightmare on Elm Street Part 2: Freddy's Revenge (1985)
1 plot hole - chronological order
Directed by: Jack Sholder
Starring: Robert Englund, Clu Gulager, Robert Rusler, Kim Myers, Mark Patton
Revealing mistake: When Jesse is cleaning out his room, he puts a tape into his tape player, and presses a button down on the top of it. But halfway though the scene of him packing his things away, you can clearly see the button is no longer pressed down, yet the tape still plays. (00:18:10 - 00:19:00)
Jesse Walsh: Hey, Grady, do you remember your dreams?
Ron Grady: Only the wet ones.
Trivia: Take a close look at the bus driver at the beginning of the movie. It is Robert Englund without his Freddie makeup/costume.
Answer: I think the coach's death was a play on his character being at a S&M bar. People who frequent those places are usually into bondage and being dominated. Hence being tied up, and whipped with the towel. It also fits in with the homoerotic subtext throughout the movie.