In order to show the code for moving the sub categories in the Categories list Widget, I had to mod the css to get it from lines of text, albeit in courier, to a boxcode {
display:block;
border:1px solid blue;
padding: 16px;
margin: 16px 30px 16px 10px;
font: 1em 'Courier New', Courier, Fixed;
}

Managed to indent and lift sub categories via stylesheet:
#sidebar li.widget_core_coll_category_list ul li ul li{
text-align: left;
line-height:1.6em;
list-style-type: none;
border-bottom: none;
margin: -6px 0px 0px 16px;
}

Change colour of sub category links by adding:
#sidebar li.widget_core_coll_category_list ul li ul li a{
color:#666699; background:transparent;
}