Unless you have some older buggy version, there is no way a group option will show when the event is set to Individual. Also, possible I suppose is that you are not really saving that setting in your event because something required is being skipped... and you don't get changes saved. Hard to say without looking. But update first if you need to. Outside of that... settings issue. Keep in mind that setting is made per event.
We are having same issue. Using version 2.6.8. Unfortunately "Buggy Version" means spending another $75 to update. Is there any chance of providing a solution that doesn't involve buying the product again to fix a bug?
We'll supply you with version 2.6.9, the latest version of the 2.6 series. Submit a ticket and we'll do it through there. You won't have support or anything beyond that without a valid license though, which will give you another year of updates and support.