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We are trying to clean up our User Groups so we are creating reports (Reports > Learner and then changing drop-down menu to Group) and then sending them out to be validated by our offices but I noticed that there are users that are not showing up in these reports, even though when I go to the particular User Groups to see all the members I can see them. However, if I use the Adobe Web Services and the APIs they do show up. Would it be because these particular users have not taken any courses?
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Depending on the report you are pulling it is very likely that the users haven't taken training won't show up in the reporting tab reports.
If you read the report group description it does talk about learning activity, not just a report of who is in what group.