>What happens to things on "Layer 1"
> - should things on layer 1 be turned off
> like Category A says, or should they be
> turned on like Category B says?

Layer 1 actually turns off with that category, but you can switch that individual layer back on, then you'll have a mixed state of Category A.
We don't really use categories in this way, we control that sort of grouping stuff with the component assembly tree where you have sub assemblies under a parent assembly.
I know it sounds complicated but it isn't really once you understand the logic of it all, and no, it's not like Autocad or Rhino layer system, I think it's more for a Mech eng cad system.

> I could definitely use some more information.
No Problem, I'll have something up tomorrow for you.

Cheers
~Danny~