Making Groups show in "Advanced - Nodes that can be referenced"

I have an 'Event' content type that uses node reference to link 'Person' who attended that event.

When I edit the event, the nodereference field shows all 'Person' content types (a large list and growing). So I created a View to filter the options of who could attend which events. I want to break down this long list of people into Groups.

I tried to achieve this in two ways...

1. Add more fields to Event node
   Instead of having just one 'Attendees' cck field I added one field for each group of attendees. Then I created different views to filter the types of 'Person' I wanted in each attendees list and used these views in "Advanced - Nodes that can be referenced."

Eg. Event nodes looked like this...
Node Title
'Attendees 1' field (Nodereference using a custom view)
'Attendees 2' field (Nodereference using a custom view)
'Attendees 3' field (Nodereference using a custom view)

Seems reasonable enough but heres where it came undone. I created a block using a default argument (Node ID) to show which Events this 'Person' attended. This worked ...but for one field only! :'(

I could not add a second argument (exactly the same but for the 'Attendee 2' field) to the view block. The idea was to have my 'Events Attended' block to show on all types of 'Person' nodes no matter which 'Attendee' noderef field referenced them.

It seemed that once the argument (default argument >NID >Basic Validation) was added for 'Attendee 1', adding a second argument (the same but for 'Attendee 2' didn't work at all. I got "No query was run" Therefore my block that was intended to work for all 'Person' content types could only work for one field per node. (this can't be right, can it?')

This lead me to the next solution. I thought I could...

1. Use only one 'Attendees' field for each Event and use a custom View to filter the results BUT show them in groups based on taxonomy.

I created a View for the "Advanced - Nodes that can be referenced" that showed all 'Person' content types but grouped them into lists based on taxonomy. The view looks great! However... in the node creation form for 'Event', the Groups don't show up. Its still just one big long list.

It seems "Advanced - Nodes that can be referenced" ignores 'Groups' set up in views.

Can anyone help me solve this problem?

Any help would be greatly appreciated! Thanks :)