I can also confirm this bug and I have a basic idea how to fix it:
if the GUI just checks if the group it creates already exists and if so errors 
or searches a solution or whatever, it should work.
So I guess this has to be forwarded to GNOME or is this up to ubuntu ?

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Creating user with username 'admin' hoses admin group, sudo config
https://bugs.launchpad.net/bugs/236305
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