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Problems with Swing Migration usually center around AD replication and the NTFRS service not working correctly. On a SBS server, which is typically stand-alone and doesn't replicate anything, these problems can go unnoticed for a long time with virtually no ill effect - until you add another domain controller into the network then the synchronization issues suddenly come into sharp relief. Check the event log for any problems with NTFRS, you need to hunt them down and eliminate them all, or you will never be able to swing.

Once NTFRS is working, I would try to use the Group Policy Management Console on the original SBS server to delete the policies. Then replicate AD with the policies already deleted to your new server. It's no good trying to just delete the files, the items need to be removed from Active Directory. Jeff Middleton at SBS Migration is a fellow SBS MVP and he is very good at sorting out these problems, he's seen most of them before. Use your included support incidents or buy some more, it'll be money well spent.

You need to install the Group Policy Management Console. The Group Policy Management Console should appear in your Start Menu under "Administrative Tools". You may invoke the tool directly from Run or the command line with gpmc.msc.