Wp-d-tree: WordPress Plugin for Categories
I made a quick video about a good wordpress plugin that is helpful in having a nice category navigation for your blog.
To have or not to have category listed on your wordpress blog sidebar can be a confusing question. The plugin in mention named wp-d-tree is a cool plugin that offers a folder like category tree that is helpful for your blog visitors.
Ideal position for the category widget would be top left hand side where your visitors are usually looking out for blog navigations. Right hand sidebar would also be a nice place to have categories listed.