It depends on what your goal is for the directory?

If you are looking to snad search engine traffic then it would make sense to have as many categories as possible, so long as you are keywording those directory page templates, you can always put 'affiliate' sites in those categories if you want to.

If however you are looking to get submissions from other webmasters, then it would probably be prudent to keep the amount of categories to a bare minimum, twinks, bears, cowboys, latin, solo, hardcore, fetish, etc, etc...

In terms of parent catgories, again, depending on your purpose for the directory, SE's give more weight to higher level sub directories than they do lower level so an index page for /directory/twinks/ will typically rank higher than an index page for /directory/twinks/blondes/.

Regards,

Lee