In the documentation for 12.10, it says this of the new Individual Groups option:
Instead of A-H you would have A, B, C, D, E, F, G, H
However when I group by Filename and turn on Individual Groups, I get a separate group for every single file rather than groups like A, B, C, D, E, F, G, H
How can I get a group for each first letter like this without creating a custom column?
The example in the manual could be better. The option creates a separate group for each distinct value in the column you're grouping by. It's intended for things like comments and tags.
Creating a custom column for what you want is easy:
function OnLetter(scriptColData)
{
scriptColData.value = scriptColData.item.name.substr(0,1).toUpperCase();
}