This is a first for me.
It appears the AD Driver is actually stripping an attribute before submitting the add doc to AD.
Here is the magical trace.
Look at the attribute ***legacyExchangeDN***

DirXML: [03/10/10 15:08:22.26]: <nds dtdversion="3.5" ndsversion="8.x">
<source>
<product version="3.6.1.4427">DirXML</product>
<contact>Novell, Inc.</contact>
</source>
<input>
<add cached-time="20100310210741.080Z" class-name="group" dest-dn="cn=ADMIN-daffy,ou=groups,dc=bartest,dc=info" event-id="uthvaultdev1#20100310210741#2#1" qualified-src-dn="dc=edu\dc=tmc\dc=uth\OU=groups\OU=ADMIN\CN=ADM IN-daffy" src-dn="\UTHDIR\edu\tmc\uth\groups\ADMIN\ADMIN-daffy" src-entry-id="71095" timestamp="1268255261#20">
<add-attr attr-name="managedBy">
<value association-ref="e63f310b83032a4b94d65367ad52d91d" timestamp="1268255261#4" type="dn">\UTHDIR\edu\tmc\uth\People\wschneider</value>
</add-attr>
<add-attr attr-name="description">
<value timestamp="1268255261#5" type="string">daffydaffy</value>
</add-attr>
<add-attr attr-name="mail">
<value timestamp="1268255261#6" type="string">daffy@barmail.info</value>
</add-attr>
<add-attr attr-name="sAMAccountName">
<value type="string">ADMIN-daffy</value>
</add-attr>
<add-attr attr-name="mailNickname">
<value>ADMIN-daffy</value>
</add-attr>
<add-attr attr-name="displayName">
<value>ADMIN-daffy</value>
</add-attr>
<add-attr attr-name="groupType">
<value>8</value>
</add-attr>
<add-attr attr-name="proxyAddresses">
<value>SMTP:daffy@barmail.info</value>
</add-attr>
<add-attr attr-name="proxyAddresses">
<value>smtp:ADMIN-daffy@bartest.info</value>
</add-attr>
<add-attr attr-name="showInAddressBook">
<value>CN=Default Global Address List,CN=All Global Address Lists,CN=Address Lists Container,CN=BARTEST,CN=Microsoft Exchange,CN=Services,CN=Configuration,DC=BARTEST,D C=INFO</value>
</add-attr>
<add-attr attr-name="showInAddressBook">
<value>CN=All Groups,CN=All Address
DirXML: [03/10/10 15:08:22.26]: Lists,CN=Address Lists Container,CN=BARTEST,CN=Microsoft Exchange,CN=Services,CN=Configuration,DC=BARTEST,D C=INFO</value>
</add-attr>
<add-attr attr-name="legacyExchangeDN"> <--***See it is here***
<value>/o=BARTEST/ou=First Administrative Group/cn=Recipients/cn=ADMIN-daffy</value>
</add-attr>
</add>
</input>
</nds>
DirXML: [03/10/10 15:08:22.26]: ADDriver: parse command

className group
destDN cn=ADMIN-daffy,ou=groups,dc=bartest,dc=info
eventId uthvaultdev1#20100310210741#2#1
association
DirXML: [03/10/10 15:08:22.26]: ADDriver: MadCommandAdd:nCommand
DirXML: [03/10/10 15:08:22.26]: ADDriver: MadCommandAdd::insertXdsAttributes()
DirXML: [03/10/10 15:08:22.26]: ADDriver: managedBy
DirXML: [03/10/10 15:08:22.26]: ADDriver: description
DirXML: [03/10/10 15:08:22.26]: ADDriver: Imported attribute description
MAD syntax DirectoryString (2.5.5.12,64)
XDS syntax string
Single valued false
Case sensitive false
DirXML: [03/10/10 15:08:22.26]: ADDriver: mail
DirXML: [03/10/10 15:08:22.26]: ADDriver: sAMAccountName
DirXML: [03/10/10 15:08:22.26]: ADDriver: mailNickname
DirXML: [03/10/10 15:08:22.26]: ADDriver: Imported attribute mailNickname
MAD syntax DirectoryString (2.5.5.12,64)
XDS syntax string
Single valued true
Case sensitive false
DirXML: [03/10/10 15:08:22.26]: ADDriver: displayName
DirXML: [03/10/10 15:08:22.26]: ADDriver: groupType
DirXML: [03/10/10 15:08:22.26]: ADDriver: proxyAddresses
DirXML: [03/10/10 15:08:22.26]: ADDriver: proxyAddresses
DirXML: [03/10/10 15:08:22.26]: ADDriver: showInAddressBook
DirXML: [03/10/10 15:08:22.26]: ADDriver: Imported attribute showInAddressBook
MAD syntax DN (2.5.5.1,127,KwwCh3McAIVK)
XDS syntax dn
Single valued false
Case sensitive false
DirXML: [03/10/10 15:08:22.26]: ADDriver: showInAddressBook
DirXML: [03/10/10 15:08:22.26]: ADDriver: legacyExchangeDN
DirXML: [03/10/10 15:08:22.26]: ADDriver: Imported attribute legacyExchangeDN <--***See it is here***
MAD syntax CaseIgnoreString (2.5.5.4,20)
XDS syntax string
Single valued true
Case sensitive false
DirXML: [03/10/10 15:08:22.26]: ADDriver: Add group cn=ADMIN-daffy,ou=groups,dc=bartest,dc=info
LDAPMod operations:
add attribute objectClass
>> group

add attribute objectCategory
>> CN=Group,CN=Schema,CN=Configuration,DC=BARTEST,DC= INFO

add attribute managedBy
>> CN=wschneider,OU=GADM,OU=People,DC=BARTEST,DC=INFO

add attribute description
>> daffydaffy

add attribute mail
>> daffy@barmail.info

add attribute sAMAccountName
>> ADMIN-daffy

add attribute displayName
>> ADMIN-daffy

add attribute groupType
>> 8

add attribute proxyAddresses
>> SMTP:daffy@barmail.info

add attribute proxyAddresses
>> smtp:ADMIN-daffy@bartest.info

add attribute showInAddressBook
>> CN=Default Global Address List,CN=All Global Address Lists,CN=Address Lists Container,CN=BARTEST,CN=Microsoft Exchange,CN=Services,CN=Configuration,DC=BARTEST,D C=INFO

add attribute showInAddressBook
>> CN=All Groups,CN=All Address Lists,CN=Address Lists Container,CN=BARTEST,CN=Microsoft Exchange,CN=Services,CN=Configuration,DC=BARTEST,D C=INFO

<--***WHERE DID IT GO?***
DirXML: [03/10/10 15:08:22.29]: Loader: subscriptionShim->execute() returned:
DirXML: [03/10/10 15:08:22.29]: Loader: XML Document:
DirXML: [03/10/10 15:08:22.29]: <nds ndsversion="8.7" dtdversion="1.1">
<source>
<product version="3.5.4" asn1id="" build="20080822_140000" instance="\UTHDIR\edu\tmc\uth\servers\dirxml\Drive rSet1\BARTEST Active Directory">AD</product>
<contact>Novell, Inc.</contact>
</source>
<output>
<add-association dest-dn="\UTHDIR\edu\tmc\uth\groups\ADMIN\ADMIN-daffy" dest-entry-id="71095" event-id="uthvaultdev1#20100310210741#2#1">202dd80303245 141a074e120b7710018</add-association>
<status level="success" event-id="uthvaultdev1#20100310210741#2#1"/>
</output>
</nds>
DirXML: [03/10/10 15:08:22.29]:
DirXML Log Event -------------------
Driver = \UTHDIR\edu\tmc\uth\servers\dirxml\DriverSet1\BART EST Active Directory
Thread = Subscriber Channel
Object = \UTHDIR\edu\tmc\uth\groups\ADMIN\ADMIN-daffy (cn=ADMIN-daffy,ou=groups,dc=bartest,dc=info)
Level = success