For example:

GCV object like this:

<?xml version="1.0" encoding="UTF-8"?><configuration-values>
<definitions display-name="Entitlements">
<header display-name="Entitlements and Exchange Configuration"/>
<definition display-name="Use Entitlement"
name="drv.entitlement.UserAccount" type="boolean">

Any driver-level GCVs linked after this GCV are not loaded (including
the contents of this GCV).

Now I know an empty <group /> element is in violation of the GCV DTD.
There is, however no warning or error (either from Designer which
allowed me to create & deploy this invalid GCV object) or from the
engine during driver startup (at least in a level 3 trace)

My question is: Is this by design?

I can't really think of a good reason why subsequent GCV objects should
not be parsed and their GCV elements added to the driver startup.