Have you rebooted the target machines? Some aspects of Computer GP are only applied at system startup. The GPRESULT.EXE utility will tell you what settings are applied from which policy. (Resource kit, I think)
I'd go with one domain, one site. Keep it as simple as possible. We have a larger installation (5000 users, 40 sites) and we still have all production resources in one domain. If you're putting in AD for the first time, be very sure your DNS is set up correctly. Of the problems we ran into...
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