Design Subcategories

Can you please explain how to add subcategories to my "Fancy Designs" categories? I've read the "Design Module" information and I see where you say "Optional: If you want to create multi-level categories, just select a Parent category" but when I go to the "Manage Categories" tab and click on a category and then click "Add New Category" it just adds another main category. I'm sure that I'm not doing something correctly so please show me the "Designs Subcategories for Dummies" version.

I also wanted to ask about the design search feature. Does it just search for the design name or will it also look at the description of the image that I add in my media library?

This is an awesome plug-in and I really want to be able to use it correctly. I appreciate your help.

Thanks,

Trae