I'm sorry, I shouldn't laugh, but I really can't help it!  You were definitely talking at cross-purposes - they were trying to tell you how to do your settings and couldn't accept the fact that it just wasn't working.

My list of categories disappeared over a year ago.  The settings are still the same as they always were.  I really can't be bothered going through the fruitless exercise of contacting ebay about it.  I've got better things to do than bang my head against a brick wall.

I've got the old style store format and I'm dreading the new style, but I can live with only having my categories only showing in the store and not in the listing descriptions.