unable to show posts according to categories

I’ve just upgraded the site to wordpress 2.7.1 . Now, I can’t list posts by category. I checked the database, and repaired it. I checked and double-checked the cat #’s and the path… This seems like such an elementary task, I don’t quite know where to start. Any clues?

Here is the site : https://www.lolaswork.com

both “press” and “home” in the sidebar should pull up all the posts in those categories… (“shop” and “gallery” are setup to pull up pages, and they work perfectly fine.