I was tackling this one just yesterday.
In addition to what Plamen has suggested, I also had to set the GroupBy on the view settings.
I think this is because I am setting DayView-GroupBy declaratively on the scheduler tag.
* Edit - checking the appointment count does not work for me because it returns the appointment count of the scheduler from the requesting page, and not the appointment count from the resulting page!
So if it doesn't work for you right away, you might need to follow suit and put something like this in your PageLoad:
sender, EventArgs e)
// Supress grouping in day view if no appointments present
(rsScheduler.Appointments.Count == 0)