When trying to add a group, the UI returns a message "Invalid user or group name(s)" after trying to add the group to a page restriction. This happens when the group has a trailing space character. This happens even if the group is selected from the group picker or entered manually with a trailing space.

You can see the trailing space by looking at the string in the groups table on the database, or by noticing the + sign in the URL when viewing group members from the group browser, as in:
<baseURL>/admin/users/domembersofgroupsearch.action?membersOfGroupTerm=FDSI_Audit+

The same problem does not apply to users, at least not users created through Confluence. It appears that trailing spaces are removed when users are created.