SharePoint 2010 + SP1 + December 2011 CU
User Profile Service is configured to sync only with AD and all appropriate permissions configured and profiles being imported successfully.
According to Audience and content targeting planning on Technet, if User Profile Service is configured to sync with Groups and Distribution lists, any synced groups/DLs can be used when selecting a Target Audience
What are audiences? Microsoft SharePoint Server 2010 supports two kinds of audiences: Global audiences
Global audiences are defined by properties in a User Profile service application. Global audiences include audiences that are defined by relationships (reporting structures), as well as other properties. Windows security groups and distribution lists
The Windows security groups that are available when you are creating audiences are those that are imported when user> profiles synchronized with the User Profile service application. The distribution lists that are available when you are creating audiences are those that are imported when user profiles are imported into the User Profile service application.
My experience so far has been that some DLs will work, but some will not. That is, when a user selects some DLs in the Target Audience picker, they will resolve and save correctly. When selecting some other DLs, they will not resolve immediately, and when I do resolve them, and save the list item/web part properties, then go back to edit it again, the audience isn't persisted. Almost like it saved fine, but didn't actually save the audience.
This issue is similar to what is described here: http://social.msdn.microsoft.com/Forums/en-US/sharepointgeneralprevious/thread/714e81a2-c8f7-4c1f-a37a-b105eb0d6a0b
Interesting point about "groups having restrictions in AD", but I can find no official guidance/documentation about this behavior.
Am I incorrect in my understanding that with User Profile Service connected to AD, we should be able to set AD DLs and/or groups for Target Audience fields/properties? Assuming this is correct, what would be causing some to resolve and save, but others to not?