I have to make something similar to wordpress_list_groups that shows groups which are empty but only when they've children groups which have posts inside them. Anybody have ideas?

Thanks

You are able to most likely do that having a Walker, however i attempted it that old-fashioned way.

$categories = get_categories();

// First index all categories by parent id, for easy lookup later
$cats_by_parent = array();
foreach ($categories as $cat) {
    $parent_id = $cat->category_parent;
    if (!array_key_exists($parent_id, $cats_by_parent)) {
        $cats_by_parent[$parent_id] = array();
    }
    $cats_by_parent[$parent_id][] = $cat;
}

// Then build a hierarchical tree
$cat_tree = array();
function add_cats_to_bag(&$child_bag, &$children)
{
    global $cats_by_parent;
    foreach ($children as $child_cat) {
        $child_id = $child_cat->cat_ID;
        if (array_key_exists($child_id, $cats_by_parent)) {
            $child_cat->children = array();
            add_cats_to_bag($child_cat->children, $cats_by_parent[$child_id]);
        }
        $child_bag[$child_id] = $child_cat;
    }
}
add_cats_to_bag($cat_tree, $cats_by_parent[0]);

// With this real tree, this recursive function can check for the cats you need
function has_children_with_posts(&$children)
{
    $has_child_with_posts = false;
    foreach ($children as $child_cat) {
        $has_grandchildren_with_posts = false;
        if (isset($child_cat->children)) {
            // Here is our recursive call so we don't miss any subcats
            if (has_children_with_posts($child_cat->children)) {
                $has_grandchildren_with_posts = true;
            }
        }
        if (0 < intval($child_cat->category_count)) {
            $has_child_with_posts = true;
        } else if ($has_grandchildren_with_posts) {
            // This is a category that has no posts, but does have children that do
            $child_cat->is_empty_with_children = true;
            var_dump($child_cat->name);
        }
    }
    return $has_child_with_posts;
}
has_children_with_posts($cat_tree);