Also, I have read around on the internet that some of the Windows 7 policy settings aren't compatible with Server 2003. Do I need to import some settings so that these policies work for Windows 7?
migrated from superuser.com Feb 5 '11 at 18:05
Use one of the Windows 7 machines and install the remote system administrator tools. Use the group policy management tool in the RSAT to connect to the domain controller. This will let you apply newer policies to Windows 7, as well as allow you to use group policy preferences, which are very useful in their own right. (source)
Another article you could read.