Groups from local replica of a directory catalog are being expanded

we’ve recently upgraded from 6.5.6 to 8.5.

we have an existing local replica of an extended directory catalog that includes groups which was functioning perfectly fine under 6.5.6 in that you could pick a group from the edc and it would stay as a group - no expansion happened.

after upgrading to 8.5 were finding that any group from the edc used for addressing is being expanded.

we can force the delivery option to not expand personal groups ($CollapsePersonalGroups=1) via policy and that stops them from expanding but these are not personal groups, although they are local, but if 6.5.6 could figure that out then 8.5 should be able to as well.

at some point were going to get conflicts if we force this globally as users will have personal groups that need to be expanded to route properly. is there some other option somewhere that lets 8.5 figure this out?