Mark,
After I posted this, I tried to add a tag to in vSphere 5.5 to VMs. I then went into vROPs and created a group based on vSphere tags. So apparently it works. There is a box to dynamically update the group. But it only seems to do it when you are editing the Group. I cannot figure out how to get the Include Always to keep the Group up to date with the vSphere tags?
Also, I have not been able to figure out how to associate Super Metrics with Groups. Groups are not explicitly in SM Object Types, but I can Environment, where my Group resides. Though I do not see this adding the SM to the group.
Thanks so much for the insight into Groups vs Applications!
-MattG