Hi Ken,
The categories are designed to show without any configuration. metaPost tells WLW to show the categories through a manifest file that should be located in manifests directory under /desktopmodules/itcmetapost/. This manifest file is an XML configuration file that should not need to be changed. I'm wondering if it either isn't there or if some other process is filtering out this manifest file so WLW can't see it.
I'm happy to take a look from my end. Feel free to send a username and password for an account that can publish to the blog through WLW and I'll help troubleshoot from this site. You can contact me privately at don at itcrossing dot com.
Thanks,
Don