thank you for your responses. Let me give more info for clarification. First off - We have already purchased a license for site1.com. With your suggestion GG, that would require us to purchase a second license for site2.site1.com whereas we do not have to purchase another license for site1.com/site2. At this point financial reasons do not allow for us to do so. But maybe once we get more providers involved and start making money, then we can switch to your suggestion, GG. But thanks for the idea.
Now, Crack, there are 2 different templates - site1.com has a totally different template than site1.com/site2 and we need to keep both templates for their corrresponding sites. Based on your earlier thought regarding cookies - I looked and there is a cookie called skin. So I added the following to my header.inc.php file to set a cookie for site1.com/site2:
$mts = "mts";
setcookie("skin", $mts);
I am hoping this works because I have noticed one small thing, In Chrome and Firefox, I only see the one cookie for the mts skin, in opera, I see 2 cookies for the mts skin. I am hoping that the double cookies will not cause an issue.
Thank you both so much for your assistance.