Dataset.groupby reductions give "Dataset does not contain dimensions error" in v0.13

[nbren12]

MCVE Code Sample

>>> ds = xr.DataArray(np.ones((4,5)), dims=['z', 'x']).to_dataset(name='a')
>>> ds.a.groupby('z').mean()
<xarray.DataArray 'a' (z: 4)>
array([1., 1., 1., 1.])
Dimensions without coordinates: z
>>> ds.groupby('z').mean()
Traceback (most recent call last):
  File "<stdin>", line 1, in <module>
  File "/Users/noah/miniconda3/envs/broken/lib/python3.7/site-packages/xarray/core/common.py", line 91, in wrapped_func
    **kwargs
  File "/Users/noah/miniconda3/envs/broken/lib/python3.7/site-packages/xarray/core/groupby.py", line 848, in reduce
    return self.apply(reduce_dataset)
  File "/Users/noah/miniconda3/envs/broken/lib/python3.7/site-packages/xarray/core/groupby.py", line 796, in apply
    return self._combine(applied)
  File "/Users/noah/miniconda3/envs/broken/lib/python3.7/site-packages/xarray/core/groupby.py", line 800, in _combine
    applied_example, applied = peek_at(applied)
  File "/Users/noah/miniconda3/envs/broken/lib/python3.7/site-packages/xarray/core/utils.py", line 181, in peek_at
    peek = next(gen)
  File "/Users/noah/miniconda3/envs/broken/lib/python3.7/site-packages/xarray/core/groupby.py", line 795, in <genexpr>
    applied = (func(ds, *args, **kwargs) for ds in self._iter_grouped())
  File "/Users/noah/miniconda3/envs/broken/lib/python3.7/site-packages/xarray/core/groupby.py", line 846, in reduce_dataset
    return ds.reduce(func, dim, keep_attrs, **kwargs)
  File "/Users/noah/miniconda3/envs/broken/lib/python3.7/site-packages/xarray/core/dataset.py", line 3888, in reduce
    "Dataset does not contain the dimensions: %s" % missing_dimensions
ValueError: Dataset does not contain the dimensions: ['z']
>>> ds.dims
Frozen(SortedKeysDict({'z': 4, 'x': 5}))

Problem Description

Groupby reduction operations on Dataset objects no longer seem to work in xarray v0.13. In the example, above I create an xarray dataset with one dataarray called "a". The same groupby operations fails on this Dataset, but succeeds when called directly on "a". Is this a bug or an intended change?

In addition the error message is confusing since z is one of the Dataset dimensions.

Output of xr.show_versions()

INSTALLED VERSIONS

commit: None
python: 3.7.3 | packaged by conda-forge | (default, Jul 1 2019, 14:38:56)
[Clang 4.0.1 (tags/RELEASE_401/final)]
python-bits: 64
OS: Darwin
OS-release: 18.6.0
machine: x86_64
processor: i386
byteorder: little
LC_ALL: None
LANG: en_US.UTF-8
LOCALE: en_US.UTF-8
libhdf5: None
libnetcdf: None

xarray: 0.13.0
pandas: 0.25.1
numpy: 1.17.2
scipy: None
netCDF4: None
pydap: None
h5netcdf: None
h5py: None
Nio: None
zarr: None
cftime: None
nc_time_axis: None
PseudoNetCDF: None
rasterio: None
cfgrib: None
iris: None
bottleneck: None
dask: None
distributed: None
matplotlib: None
cartopy: None
seaborn: None
numbagg: None
setuptools: 41.2.0
pip: 19.2.3
conda: None
pytest: None
IPython: None
sphinx: None

[dcherian]

@nbren12 I had a quick look at this on my commute this morning.

1. Somehow squeeze=True when it is False in the groupby constructor. Not sure why.

2. For squeeze=True, the Dataset behaviour is correct since you're attempting to reduce along the grouped dimension which has been squeezed out. DataArray is incorrectly reducing all dimensions in each group (This was deprecated in 0.13)

I have partial fix in #3338 with a better error message but it needs tests and docs; and also a fix for squeeze being True by default. If you have time, can you finish that up?