You cannot configure Group Policy Objects (GPOs) to process different policies for different local users based on group membership. This is possible using only Active Directory Group Policy Objects.
Multiple local group policy objects are not supported in Microsoft Windows 2000.
To work around this behavior, implement Microsoft Windows NT 4.0 style policies using the Policy Editor tool. For more information, please see the following article in the Microsoft Knowledge Base:
Guide To Windows NT 4.0 Profiles and Policies (Part 4 of 6)
Microsoft has confirmed this to be a limitation in Microsoft Windows 2000. The ability to have multiple local group policy objects and have Access Control List (ACL) filtering for local group policy objects is being considered for inclusion in the next version of Microsoft Windows.