I am having trouble finding the answer to this question also. The answers I have read so far all seem to be partial/incomplete answers.
Just as the OP stated, when sending a text, and you get to the screen where you select the recipient(s) that you will be sending the text to... if you choose more than 1 person, then a little option bar appears that says:
"Recipients Reply To: ○Group ○MMS ○Just Me"
and then you have to choose 1 of those 3 options that are given. Now, I haven't yet seen a clear and specific answer about exactly what each option is, ESPECIALLY the description and differences of the "Group" and "MMS" options.