Hi Bill, welcome to the world of Role Based Access control. :) It sounds to me as you now need to apply the permissions to the groups and servers. Right click the smart group and choose 'update permissions'. Make sure you have "append" selected and then click the green plus. Select your role from the menu and then add the permissions you want that role to have. Click ok. You need to do the same steps for the servers as well, but when you have added the permissions to the servers, you need to make sure you run a "push ACL's job." This can also be done by right clicking the server and choosing the push ACL's menu option. That should do the trick.
When a server group shows up in italics it's referred to as a "No Access Node", meaning you do not have read permissions on that object. You can turn off no access nodes under Tools -> Preferences.
you can also disable the 'no access nodes' globally by using the blasadmin tool on the appserver and running:
set ConfigManagerUI ShowNoAccessNodes false