It does -- thanks. And thanks to everyone who posted helpful info in this thread.
Conor's instructions are simple and correct:
Click Sign Out in top-left corner of iTunes Store. Then search for App to gift and click the arrow adjacent the price (which displays as you are not logged-in) you can then Send Gift.
It seems like a plan that would work for regular apps (thanks for the tip). I think what's causing it to be more difficult for me, is that the iCreate Magazine app is free, and I want to "gift" one of the in-app-purchases of a particular issue of the magazine. Oh well. Maybe later. Great tip though. Thanks.
I'm running App Store 1.2.2 and *cannot* gift 'Day One' to someone who can really use it. I tried signing out, etc. and it STILL tells me its already on the computer and I get only 'Share' buttons. I live in Canada so maybe it's a North American licensing thing. Makes me mad.
I've contacted the company. Maybe I can buy it from them and they can give her a serial number or something. Grrrrrrr...