I tried searching for what a "lifestyle fee" is and all I could find is references to "living wage fee" which is essentially a forced tip added to the bill.

A service charge for large groups though is understandable as they typically will require much more attention and work from waitstaff than the typical small dining party.

I'm somewhat skeptical that they actually require more attention per person. Does an 8-person group require more than 2x as much attention as a 4-person group?

Large groups are also the most notorious non-tippers.