The computer seems to be infected with a virus.
UAC bypass through Trusted Folder abuse
is a method for tricking Windows into running programs with
Administrator permissions, by using a blank-terminated
Windows \System32 folder.
The program doing it is named credwiz.exe. The name is legit,
but the program may not be the one that is part of Windows.
I think you're confusing GPO security filtering and GPO hierarchical scope. The security filtering ACLs only deal with accounts and groups, never with containers. On the other hand, GPOs can be linked directly underneath any OU (though not underneath built-in containers) without the need for security filtering. Groups and containers are not the same thing.
I would simply do a directory or catalog mail merge within Word and keep the data in an Excel spreadsheet.
Here is an excellent tutorial on using such mail merge tools:
Catalogue/Directory Mail Merge Tutorial by Paul Edstein, Word MVP
See also his Mailmerge Tips and Tricks and this Microsoft Help Page.
Here is a Microsoft Training Video.
Here is my more ...