Well actually... if you start when they're puppies I KNOW from experience you can do this. I have cedar chips in my dog run. When I whelped my litter, I put a low-sided box of cedar chips in the whelping box and the pups learned to potty in it. Helped keep the whelping box clean.
Some people have a very tiny patch of grass just for their dogs to potty on. They train the dogs (or the dogs prefer?) to potty in just that area.
Mine run off to the 4 furtherest corners of yard, back up into the bushes or behind trees and go.
[I guess they're shy like that]..;))