In my little knowledge of the *nix internals, you cannot access a directory if it has not the executable bit. Since the permissions for the group are still rwx, other users can descend into the directory.
Also note that if you set the executable bit, but not the read bit
$ chmod 177 testdir
$ ls -ld testdir
d--xrwxrwx 2 colucix users 4096 Apr 15 15:10 testdir
$ cd testdir
ls: .: Permission denied
you can cd into it, but you cannot list its content.