Sales pages in a sub directory or sub domain??

I like putting the sales pages in a subdomain of their own. More versatility that way. Of course it can still be linked to your blog, but will also appear as an independent site. So depending on how you intend to drive traffic, either now or down the road, you can get more targeted.
Plus with a subdomain you then have the option to create as many pages as you like, without the site getting cluttered.
I just think it gives you more flexibility.

It doesn't matter much, but more of your blog's "authority" / position in search engines and pagerank will be passed to your sales page if you use sub-directory, therefore chances that the sales page can be found in search results directly will be a little higher.

I have a site that has over 600 products on it. My software puts the sales letters in folders on the same domain. Example...

DomainName.com/products/product_1

DomainName.com/products/product_2

DomainName.com/products/product_4

When I promote one of the products I use a tracking link that looks like...

DomainName.com/r/ProductName

My affiliates use their affiliate links to advertise each product.

I have in the product_x an index.php file that allows me to uses tokens of each sales letter to do many different things like change the price, turn it into an OTO, allow members to brand the sales letter with their name and much more from the admin area.

All the sales letters are named... index2.htm

This is so the index.php will automatically redirect to this sales letter (index2.htm.

The bottom line is that putting multiple products on one domain has been working for me just fine for over eight years.

I also know many other people who put multiple products on one domain with no problems.

I hope this has been helpful,
Steve Yakim

Subdirectory is more prettier if you ask me, but SEO wise it doesn't make a great deal of difference from my experience.