In CT that bike (Trek 5000) was $1995 all year long so a markdown TO $1995 isn't a great deal...at least around here.
As far as cash being king...I bought a new Lemond Zurich this year and was trying to make a deal with a small shop for a leftover 2003. They would not budge on price (after their markdown from $2,200 to $1,800 because it was a leftover). I asked for a credit in the store to make up the cost of tax and the owner said he couldn't do it. I didn't ask for a FREE bike, I asked him to basically give me $100 credit in his shop. Now, $100 credit is actually more like $45 out of his pocket to sell a leftover that has been sitting on the floor for more than 1.5 years (I saw this exact bike that long ago.) He wouldn't move at all. So, I asked about an '04 (which they didn't have in stock- in fact, they hadn't had one all year to that point- it was June- his price was $200 more than another local shop. I bought an '04 from the other shop because he was $200 cheaper right off the top AND they gave me instant 5% in store credit off the $2,200 (read: $110) ...PLUS, I get 5% in store credit for every dollar I spend there from now on.
I guess it just depends on the dealer...I haven't been back there yet but I bet that 2003 is still sitting there.
I saw be polite and don't ask for the world. I've bought many different things over the years (not all bike related) and the cash price is usually better. For nothing else you can usuallly negotiate the cost of tax.
PJ