Hello @pimmysits 

Thank you for the inquiry. In Kasa APP,
 Grouping is to control a group of devices ON/OFF in the Kasa APP. 
FAQ: How to use the Grouping feature in Kasa app 

Room is to put devices in different rooms, so you can view and manage devices in the app more easily, especially when you own multiple Kasa devices .
Here you can learn more details of Room feature in Kasa APP 3.0 

In the Alexa app , you can view Amazon guide here to put smart devices in a group 

Can you explain your request for us?   My idea was to "group" (using that term generally) the switches in my rooms, then group the rooms into floors, and finally the floors into "inside". Then group the inside with the lights outside for a final group - The House. '