Categories are used to group entries (posts) that cover the same subject. Entries can be assigned to multiple categories. Categories are organized hierarchically. See example below.
General :1 Music :2 --Announcements :3 --Events :4 ----Misc :5 Technology :6
IDs are just IDs. They are not required to be consecutive. You may wish to use 1000, 2000, 3000 etc. for your main categories, so you can add intermediate numbers for subcategories later.
To setup categories:
FlatPress does not check your input for duplicate category names or IDs on save.