Yes modifiers carry over even if you make instance real, because it creates new object containers as linked duplicates. Basically anything at data level carries over. It’s object level(Like parenting) that doesn’t survive making instance real, because it’s a new object. Side note: An instanced collection is the collection’s equivalent of an object’s Linked Duplicate(Alt+D). Linked Duplicates is covered in the Blender basics course around the 2 min mark: https://cgcookie.com/lessons/duplicating-joining-and-instancing
As for Groups(In my terminology), This is just a collection that isn’t seen in the outliner in normal view layer display. Technically speaking it’s just a collection that isn’t linked to the scene. Other then not being linked/seen, it is the same thing as a collection.
Also you can add collection instance thru Shift+a->Instance Collection->Select your collection. Also part of the Blender Basics course see around 11 min mark: https://cgcookie.com/lessons/visibility-and-collections-aa836f8f02ed5dfa
