Honestly, I’d probably do both, but when you report a group title, the popup says,
“This includes any form of hateful, discriminatory, obscene, or disruptive text used in the group name”.
I suppose throwing might fall under “disruptive”, but it seems like the report group title option is mostly intended for other situations.
That said, apparently Blizzard keeps a very close eye on this. See this post from Jeff:
I hate the idea of a group purposely throwing so they can smurf and ruin the games of hundreds of players, so I’d report them just to help Blizzard out.