Hide a section in report - Report level and Framework level Security

[Bindiya]

Hi Everyone,
We have a requirement of hiding 2 sections in a report from 2 user groups say, "Group 1" and "Group 2".

We used two approaches for hiding each section.
1. One section is hidden by applying security at report level. I.e. used a conditional variable to check if user is in "Group 1" or "Group 2" then hide it. It worked fine.
2. For the second section, we tried to hide it by applying security at framework level. I.e. for the intended query subject, in the properties we applied a security filter for both those groups. But it didn't work and the users in both the groups are still able to see this section.
The weird part is, if we create a new group say "Group 3" and then add some users from "Group 1" and "Group 2" and use this "Group 3" in FM security filters, then it works fine.

Why was it not working with existing groups "Group 1" and "Group 2"? If there was some issue with these groups then how was it working fine in the first approach? These are Cognos groups (not from active directory). We tested it on active directory user groups and it works fine for them.
We are on 10.1.1. Could it be because they were created in 8.3 and so don't work fine in 10.1.1?

Appreciate any inputs.

Thanks
Bindiya