[nacredata]

The following pair of simple hacks seem to work for me (4.1.11)

in /modules/Special_Offers/func.php around line 1330:

    # Part 2: Apply bonuses
    #
    $discount = 0.00;
    $_SESSION['ND_freeshipping'] = NULL;

    # Apply discount bonus
    foreach ($products as $pk=>$product) {

        if (@$product["deleted"]) continue; # for Advanced_Order_Management module

        if (!empty($apply_bonus[$pk])) {
            $bonus = $apply_bonus[$pk];

            if ($bonus['discount'] > 0.00) {
                if ($config["Taxes"]["display_taxed_order_totals"] =="Y")
                    $products[$pk]['saved_original_price'] = $products[$pk]['taxed_price'];
                else
                    $products[$pk]['saved_original_price'] = $products[$pk]['price'];
                $products[$pk]['price'] -= $bonus['discount'];
                $products[$pk]['special_price_used'] = true;
            }

            if ($bonus['free_shipping']) {
// NacreData L.L.C. info@nacredata.com 
// Need to offer free shipping only on UPS ground, not on all delivery methods
// so rather than just mark it all free here, rather set a flag which we can
// check later (see /shipping/mod_UPS.php around line 551)

//                 $products[$pk]['free_shipping'] = 'Y';
//                 $products[$pk]['free_shipping_used'] = true;
                $_SESSION['ND_freeshipping'] = true;
            }            
        }
    }

in /shipping/mod_UPS.php around line 550:

// NacreData L.L.C. info@nacredata.com 
// Need to offer free shipping only on UPS ground, not on all delivery methods
// so rather than just mark it all free in /modules/Special_Offers/func.php 
// (around line 1353), rather set a flag there which we can check here 

// is ground shipping ALWAYS methodid 1??  Appears to come from the database
// table xcart_shipping

                    if( isset( $_SESSION['ND_freeshipping'] ) && $subcode == 1 ) { $data = '0.00'; }
                    $_rate_data = array(
                        "methodid"=>$subcode,
                        "rate"=>$data,
                        "currency"=>$mod_UPS_currency,
                        "orig_rate"=>$orig_rate,
                        "warning"=>$RatedShipmentWarning,
                        "service_code"=>$sv["service_code"]
                    );

Also note something we discovered: it seems all items need to have a weight assigned to them. Items without a weight may not trigger a shipping recalculation.