What aperture to use for group shot?

How does it look in the format in which people will actually be seeing it? Will they be making poster-sized prints? This matters.

As for your exposure: you don't mention the ISO you chose to use. If you don't under-expose, you should be able to shoot at, say, ISO 400 with that camera and not be sorry. That should get you to f/11 or so.

But you're not telling us the whole story. How were these people arranged? Where (and how) did you focus? Are any of the faces sharp? Is the softness due to camera movement (did you have the camera stabilized in any way? ... it's easy to introduce motion blur even at 1/160th if you've got the jitters).

Describe the distance between you and the first person/row in your group, and the distance to the last person/row in the group. Keep that in mind, and then run some mental simulations through a DoF calculator like this one.

At 25mm, f/7.1 should be quite adequate for group shots when the focus point is 25 feet away. It's hard to be sure without seeing your picture, but I am inclined to doubt that DoF is the problem. Focus error, camera motion, or subject motion would be more likely, though IS should have taken care of camera motion problems.

IS was on. The group was about 7 rows deep and wider in the front than in the back. So the front line had more people than the back line. The people in the front were on the ground level and the people in the last 4 rows were on stairs.

I was using one shot focus, center point selected. I focused on someone in the middle of the front row. I dont have the pic with me now. I will be able to post it tomorrow though. I took about 20 shots and most were in bursts so I dont think that camera movement is the problem.

Can I get some example of how sharp group shots should be when you zoom in in Lightroom?

Actually I just found that I do have the pictures. What are the rules about uploading here? Or Should I upload somewhere else and insert a link here?

You can upload a picture that you took yourself. The best way to put an image inline here is to post a comment and then use the "attach image" feature that is offered just after you've posted. This will allow you to upload an image from your computer. Scale or crop the image in advance to be no more than 700 pixels wide and high, or else PN will resize it automatically.

For a case like this, the best thing would be first to post the whole image, resized down to 700 pixels wide, then post a few 700 pixel-wide crops at 100% size so we can see both the person you focused on (who should, presumably, be very sharp) and someone further back who looks fuzzy to you. With this, you will be providing a useful basis for sensible discussion about the image.

Btw, when photographing multi-row groups, the best thing is usually to focus on someone in the middle row, to make optimal use of depth of field. However, in this case, just based on the information you've given us, I don't see why the group wouldn't all be in focus. 25mm at f/7.1 on a Canon T2i ought to have a hyperfocal distance of about 9 to 10 feet, so focusing on the front row of a group 25 feet away should have gotten everyone in good focus.

Ok here is the original image.

That looks a lot worse than the image on my computer.. why is that?

here is a cropped portion of the middle. Is this called a 100% crop?

And I know the lighting is terrible. That is where they wanted the picture taken and thats the only time of the day they could do it.