Created on behalf of Scott Vanderbilt Help Discussion entry https://sourceforge.net/p/passwordsafe/discussion/134801/thread/1c5039bd/ :
'Delete Group' on an empty group does not delete the group in the tree view.
Dragging the last entry out of a source group that has no empty subgroup to a destination group causes the source group to be removed from the tree view.
Will be fixed in next release.
Workaround: Drag an entry into the group to be removed, then drag it out again.