I've noticed that group fields don't get the same conversions that a regular field gets. For example a stand alone object field like an image, taxonomy or post outside the group with have it's object data, but when in the group just the ID of said object is available. Is this by design? Or is this something that should be fixed?
That's right. The values of sub-fields don't go through the functions that transform the raw value to meaningful values. This is the initial design of the group data.