I am just wondering if the GND and Ugnd pins are isolated internally from each other on the ATMega32U4?
The reason I am asking is I would like to isolate my GND and Usb ground on the board and wondering if the ATMega does it without having to go to a specific USB isolator?
Any info would be greatly appreciated.
No, you do not isolate UGnd from GND.
Refer to the Leonardo schematic (http://arduino.cc/en/uploads/Main/arduino-leonardo-schematic_3b.pdf).