I know your looking into getting your categories to be in a drop-down format like this on your WordPress blog. Well I am going to show you how to enable that feature. I never knew that it was there and all I needed to do was simply enable it.
Simply log into your WordPress blog (only your own independent WordPress blog, not a WordPress.com blog). Now follow the menus down to the middle left-ish area, and you’ll see the Appearance menu, now click on that then click on Widgets.
Now simply click Save, and now your categories on your blog will look like the image at the very top of this post.