Actually, Coe only "choked" once in the olympic 800. In 1980, he was the overwhelming favorite, but in 1984, he head been sick for over a year and had only returned to training in January. Most people had written him off and Joaquim Cruz was considered the favorite heading into the race. Getting the silver medal was a tremendous accomplishment. And, while Coe choked in the 800 in 1980, he made up for it by handing the favorite Ovett his first loss in almost 4 years. Comming back to win a race that you're not favored to win after choking a few days earlier in a race you were supposed to have easily won is way up there among the toughest things to accomplish mentally as a (mid)distance runner.
That said, I would not consider Coe to be the best ever, I think El Gerroudj has now earned that mantle. And just because Lagat chased him to line and ran a near wr-race a few years ago and beat him twice doesn't leapfrog him ahead of all the greats who have won olympic golds and set world records. My top 7:
1)Hicham El Gerroudj (8 years #1, 2 wrs, olympic gold)
2)Nourredine Morceli (7 years #1, 3 wrs, olympic gold)
3)Sebastian Coe (2 years #1, 4 wrs, 2 olympic gold)
4)Herb Elliot (undefeated entire 4 year career, 3 wrs, olympic gold)
5)Peter Snell (3 #1s, 2 or 3 world records, olympic gold-after winning 800)
6) John Walker (3 #1s, 2 world records, olympic gold, world ranked over 12 years)
7) Kip Kenio (olympic gold, 2 or 3 #1s, world ranked over 8 year period)