OK, it looks like you also have to pipe the folder into a variable using Get-Folder. Specifying the folder name in the command syntax is where it fails.
I was doing this:
New-VIGroupPermission "DOMAIN\Group" "Folder" "Role" $true/false
Need to do this:
$folder = Get-Folder "Foldername"
New-VIGroupPermission "DOMAIN\Group" $folder "Role" $true/false
Naturally when scripting you would pull this into a variable, but I was just testing the syntax when I found this.
Thanks for helping me out!