hello Denmark, Faroe Isles here
Categories are hidden until you post stories using them.
Subcategories do not work yet with Pligg, as you can read for example here:
http://www.pligg.com/forum/showthread.php?t=661. The parent option in the database table is from the original Menéame code.
My advice is though to be a bit conservative with using the categories too much, here in the beginning. I started out with having a lot of them, but chose to delete most of them again later on... which was tedious, as I had to remap all the stories that used the now deleted categories.
One reason is that they might (or might not) go, in the near future. Read this interesting discussion, where 3dkiller and juicecowboy fight over whether categories are good or bad:
http://www.pligg.com/forum/showthrea...=5040#post5040
My personal opinion about categories is that they are confusing. They're not really usuable for categorization(!), as you can only use one with each story. So me and my users got into problems with instances where a story fitted into eg. both the category 'Denmark' and 'Politics'. The Pligg categories are more like sections in a newspaper, where you choose if a story fits into eg. the 'sport' or 'economy' sections, but of course not in both (as you don't want duplicated stories in the same paper).
Another problem is, that they don't show in the tag cloud. In my case, I chose for example 'sport' as a category title, but then later on realized that this made 'sport' disappear in the tag cloud. I guess most users feel that if they're forced to choose 'sport' as category, they don't also have to mention 'sport' as a tag. So I'm now using more fluffy category titles like 'other news' and 'nerd stuff', in order to not prevent users from using good categorization words like 'business' and 'technology' as tags.
But the one good thing about categories is, that you don't get all the variations of the same concept, as with tags. For example, if you did decide to use 'sport' as a category, you wouldn't get variations like 'sports' and 'sport news'. I intended to write this under 'suggestions', here in the Pligg forum, but since I'm already warm, I'll just start out with mentioning it here: I think the Pligg core developers ought to look at how another good open source social bookmarking
cms called
Scuttle encourages people to recycle tags, by allowing users to just click on a list of the most popular tags, when posting a story or link. It is simple and works really well.