Not at a computer at the moment, but a hidden object still exists and takes up space. If you view your layout in Layout Mode you will see the hidden object.
Oh it takes up space all right. When it's showing, it closes up the section in preview, but when it's hidden it doesn't. The object in question is a grouped portal and its column headings. I was hoping that when there was nothing in the portal, I could make the report much neater by disappearing the headings and the portal entirely and have the space tightened up with the sliding directives. Perhaps in another update.
I assume that you mean hidden via the "hide object when" setting on the inspector's data tab.
I cannot reproduce this in Windows 7. (Don't have a mac to test.)
I put three fields and their label text on a layout. I selected Fields 2 and 3 plus their label text and grouped them.
With them still selected, I entered True into the Hide Object When box and selected "slide up" and "resize enclosing part".
The attached screen shots show layout mode on the left and preview mode on the right. The body has been resized to eliminate the space occupied by the hidden objects in the right hand image.