I have these settings working in an AD environment in Moodle 1.9.2 (though it has worked since 1.6)
Contexts
Teachers: ou=Moodleteachers,ou=Security_Groups,dc=ourdomain,dc=edu
Students: ou=Moodlestudents,ou=Security_Groups,dc=ourdomain,dc=edu
The member attribute for AD is "member"
This works well for us and is the basic setup from Lar's documentation how-to at http://moodle.org/mod/forum/discuss.php?d=31761