Could someone explain what the new sub-cats are 4?

Excellent! I’ll have to check it out.
This is what I would use it for.
I have a bunch of jokes I want to post outside my normal blog. So I put them all under the category of “Jokes”. However, I want to group the jokes by types, so I create sub categories (i.e. Blonde, Seasonal, Adult, Computer, Dating, etc..) .
Then I can make a blonde joke of the category Joke and sub category Blonde in my blog database and display it with the other blonde jokes.

Here’s what I do use it for. I have a category called Writtings & Scribblings where I put some of my writting. I’d like to keep my poems separate from my novelization. So, under the main category, I have Poems and “Thorak’s Tome” (the title of the novel), in the future, I’ll add more categories as I need them.
TG

but arent they still show like a normal category on the index page?

You can have list_cats display the categories hierarchically, and you can have the_category display the ‘path’ to the category, like ” Writtings & Scribblings > Poems”, to use TechGnome’s setup as an example.