Does group riding negate the aero benefit of deep rim wheels?
The aero benefits of deep rims come from reducing the spoke length. Imagine that you're drafting behind a large truck at 25 MPH; you're not experiencing any headwind, but your spokes are still going around in a circle and slicing through the air. So reducing the total length of all the spokes (by using less spokes or shorter spokes) will give you better aerodynamics no matter what.

Look at what the pro road racers do (I mean besides the doping.) They use moderately deep rims on flat races, and only use shallow ones for climbing (when weight is a more important consideration).