sharepoint adminsitration and website specific administration
I wish to know as what is the difference between giving permissions to users at the following levels:
1. sharepoint administration website- Central administration\site settings\permissions
2. sharepoint administration website-Application management\Policy for web application
3.Created website- Adding a user under Peoples and Groups header
I need to know what is significance of each level and is there an hierarchy and overriding which happens.
One more query, we have a active directory group defined in our local domain.Our domain name is nature and group name is testors.
Now i need to give full access permissions to this group for a particular sharepoint website created.When i give this permission using 1 & 2(described above), these permission doesn't take effect(i continue getting access deneied until i add each user of the group seperately to the permitted user list).When i try to give permission to this group at website level(point 3), it doesn't recognises the group.Is there some specific reason to this and any remedy for this

