When applying a policy "Customer Policy X" in Studio to an AD Group "Customer Group X" which only contains a small amount of users.
"Customer Policy X" looks like it is applying to all users / computers in the environment when checking the applied policies in Director.

When checking what policies are getting applied in HKLM\Software\Policies\Citrix it appears that the policies in "Customer Policy X" are not getting applied and that it is simply a cosmetic issue

Problem Cause

Configuratin issue - As there was Computer Policy(s) in the enabled policies, it acts as an unfiltered policy when applied to an AD Group.
As a result -> Policy was getting applied to all VDA's from "Customer Policy X regardless of who is in the AD Group"

The User Policies were correctly getting filtered - Hence believing the policy was cosmetically applied