This is an interesting take on the issue: http://ncmg.blogspot.com/2005/07/coy-dogs-maybe-not.html

Dan, I remember when New Hampshire and Vermont were up in arms because of what was then thought to be Coydogs (Coyote father, dog mother). Within ten years or so, biologists had concluded that in fact a coyote- domestic dog hybrid was rare. The same conclusion was reached here in Maine.

Maeve