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After the news of the 2 way 'merge' groups/sitecollection I thought that one good thing could come out of it. A voice with the same name as the group appears in the people picker so I thought I could use it when setting up alerts on lists in the site. I have tried and while it lets me put the group in the alert form, the alert is not sent.

If you need to instruct people about the new 'site' and start using alerts on new document libraries there, they are going to be disappointed that they cannot use the existing group for alerts.

I wanted to check that this is the feature so far.

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The email address that gets generated on creation of an office 365 group is just a mail distribution group. Alerts cannot be set using mail distribution groups in SharePoint as has been the case historically as well. Even permissions cannot be granted to distribution groups in SharePoint.

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