yeah, thats not the way the groups manager works.
The groups manager allows you to create a list of values that can be used in rule. It is not intended to change anything in the database, that is done through PHPMyAdmin or a page you create to manage the users.
If you want the different users to belong to different user groups, you need to change the value in the GroupID column manually.
When dealing with user level authentication, you need to edit the Security Assist Authenticate User behavior on the login page, on the Session tab, make sure the GroupID column is being stored in a session variable.
you can then create access rules for the user levels based on the groupID session variable value.
for example:
Allow IF
Value: Click the lightning bolt icon and selct the GroupID session Variable
Criteria: =
Compare to: 1
this would allow all users where the GroupID session Variable is equal to 1.
lets say you wanted to create a rule to allow multiple GroupID values. lets say you want to allow GroupID 1 and 2, thats where the group manager comes in.
create a new group, and add two new group members, 1 and 2.
you can then create a new rules as:
Allow IF
Value: Click the lightning bolt icon and selct the GroupID session Variable
Criteria: In Group
Compare to: Select the Group you created.