How to use Categories?

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Please could someone explain how Categories work? Or point me to some help text?

This is what I did:-

I switch from the Folders tab to the Category tab, created a new category, select a few images and click on View>Set Categories...and select my new category and click Apply.

Now when I click on the category in the Categories tab, I see the only the files I selected. So far so good. Each image now has an icon next to it at top left. NB the icon did not appear directly after clicking Apply.

What's confusing me is:-
1. When I select one of the images and examine its categories tab, my newly added category is not in the list. I expected to see my newly added category listed and ticked. Where is the information held? In the image file, or another file? If I do this with a predefined category, it does show as ticked on an individual image file.

2. When I remove the tick in the main Categories tab, my selected images still show in the right hand pane. I expected them to disappear. If I tick another category by itself, then of course they disappear.

3. If I tick my new category plus another category, the image files still show, so the logic is OR and not AND. OK I suppose, but I can't use categories to select on multiple criteria then? i.e. It's a Landscape and Spanish. How would I do that?

4. If I do View>Select Categories again and deselect my new category, the little icons are still there on my image files, even after refresh, until I select another folder and then reselect the folder they are in.

5. If I create a Category with a sub-category and apply only the sub-category to image files, I click on Category but don't see the images in the sub-category. I would have to apply the category to the images as well to do this.

How do the categories relate to the IPTC category fields?