Yes, you are correct - timeline annotations cannot be added for specific groups. Basically, you can specify a fixed height and offset from the top of the timeline for an annotation, but you mentioned that this will not work for you. I will forward your feedback regarding the annotations to our developers.
In case you simply want to apply different background to the different groups of timeline items, you can edit the template of the TimelineItemGroupControl.
On the other hand, in case you have sections in a group of timeline items that you want to color, there is no simple way to achieve this. You can, for example, edit the template of the TimelineItemGroupControl to add your custom ItemsControl that shows these colored sections.
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