Newbie question

Hi
Here is the goal:

I need categories names displayed as a menu
and when I click on each, I need feeds (short paragraph of news) to show on one page according to that category

Also, I have “No feed items found.” every several items

and a question about “templates” – cannot figure out where they are connected to feeds. Default template rules all feeds. then, what is point to create new ones?

Where do you indicate which template controls what?

Thanks and sorry if it sounds dumb.

PS I purchased category module but it does not do exactly what I thought it would.