Smart Folders grouping unintuitive

The question I have is this:

In a view, you can select a database and group by a field. This makes the grouped by field the top level of the list/table etc.

If Entity A belongs to User A, I want them to be able to see it in the smart folder.
However, I want the top level to be grouped to pre-filter entities into smaller categories (less visual clutter).

It seems this isn’t currently possible. Is there any way without major changes occurring to get this behaviour to work in this way?

And before you say, “Create a new database and change the field, then make the smart folder based off this new database”—I can’t. It would screw up a ton of automations. Also, it wouldn’t hide items with no relations (or that have been filtered based on access levels for the active user).

Can you clarify what the relations are.
It seems like maybe you could use a two level setup in the table/list, instead of one level with grouping