Daisy,
My custom categories appear on the right side of the screen on my Plant List home page
https://garden.org/lists/view/...
I can answer your second question...
Go to your profile page
Scroll down to the Plant List Section and click on the words "there are ?? plants in..."
click on "Manage Categories"
Type in a Name for the new category and click on "Add Category". In this example, I will create a category called "Another Test"
You will see your new category added to the list. Click on "return to your lists control panel"
You will see your new categoey added to the list on the right of your Plant List Screen. Now we need to add plants to the list. In this example, I will add "Coral Bark Japanese Maple" to the "Another Test" category. Click on the edit icon for the plant you wish to add to your new category
Tick the category you wish to add the plant to and then click on "Save Your changes"
Click on Return to your list management area
You will now see 1 plant in your new category
In regard to the usefulness of categories, I think they are useful if you want to easily search for a group of plants that have something in common. I have created a category called "Planning to Order" and another called "Overseas Irises to Order" because I often see plants I wish to buy which aren't available because they are out of season, out of stock or not available in Australia yet.