The displayName attribute is not returned when using the User Manager SmartObject against a Group Object. This is apparent when the 'SharePoint People Picker Source' SMO's 'Search' method is fired as the displayName property is depicted as NetBIOS + "\" + samAccountName. As noted this is by design as the attribute is not returned via the User Manager SmartObject, as the 'SharePoint People Picker Source' SMO sits on top of the User Manager SmartObject in which the attribute is not returned.
NetBIOS + "\" + samAccountName is depicted as displayName when firing the 'SharePoint People Picker Source' SMO's search method.
The displayName attribute can be returned via ActiveDirectory v2 broker however the caveat is a performance hit. An idea has been submitted to have the attribute returned via the User Manager API which you can vote for here: https://ideas.k2.com/ideas/APIT-I-682.