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2003 SBS + XP pro + Active X controls + Group Policy + Windows Domain

Hello, we have a single server running SBS 2003 with our workstations running XP Pro SP2 fully patched (minus IE7) in a domian situation.  We have 110 workstations and of those we have 3 that need access to a special website that does updates and uses Active X controls.  
The problem is that we are using the "Enhanced Security" for web browsing in IE and have a IE maintenance prolicy in effect.  

Here is the scenario:
On that website I mentioned above we get active X control errors when the user tries to update their browser controls.  We have called the sites tech support (of course they are as helpful as a phone support normally is) and tried making one of the 3 users - local admin and domain admin with no change in out come.  Here is the kicker - we log in as LOCAL admin and the update rolls on as it should with no hitches.  

Our question is sort of two fold:
1) is there a way to lower security of the "Enhanced Security" with out compromising the network (we dont want everyone to be able to run rampant on the net)
2) is this behavior from the Enhanced Security or is this from the Group Policy?

We have added the site to the trusted domain list, we try to configure the trusted domains security in Inet options and we click ok, go back and check it and its back to the default.  We cant change the default level either.  
Any ideas?  We dont want to have to put a stand alone machine for the end users to use because thats an infection waiting to happen (and I already put in 10 man hours cleaning up that mess!).

Thanks for your time everyone
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