This KB http://support.microsoft.com/kb/938999/en-us was published last month and I missed the notification here.
In Microsoft System Center Operations Manager 2007, you use the Operations console to configure a rule or a monitor to target a computer group. However, the rule or the monitor does not work as expected.Note In Microsoft Operations Manager, a rule that targets a computer group works as expected. Microsoft Operations Manager 2005 uses management groups for the following purposes:
•To create logical collections of objects, such as Windows-based computers or Microsoft SQL Server computers
•To target monitors and rules to apply to a specific group
This issue occurs because Operations Manager 2007 uses management groups for the following purposes:
•To approve members of an Operations Manager 2007 user role to manage specified groups of objectsFor example, you can approve members of the Messaging Operators user roles to monitor objects in the Messaging group.
•To create views for specific groups of objects and to approve members of an Operations Manager 2007 user role to see the viewsFor example, you can create a state view for the Messaging group and approve members of the Messaging Operators user role to see the Messaging view.
•To use overrides to disable or to adjust the configuration of a monitor that is applied to one or more managed objects.
To target your rule or monitor to the systems that you want to track, you must now use the correct class that describes the objects that you want to monitor.
To work around this issue, disable the rule or the monitor. Then, create an override for a group that enables the rule. To do this, follow these steps:
1.Make sure that the rule or the monitor is disabled. To do this, click the General tab in the Properties dialog box for the rule or for the monitor in question. Then, make sure that the Rule is enabled check box is cleared.
2.Configure the rule or the monitor to target the group that you want to use. To do this, follow these steps:
a. In the Authoring pane in the Operations Console, locate the rule or the monitor.
b. Right-click the rule or the monitor, point to Overrides, point to Override the Rule or to Override the Monitor, and then click For a group.
c. Click the group that you want to use, and then click OK.
d. Click to select the Override check box, and then click True under Override Setting.