Before I updated to the latest version there used to be nested drop downs for the categories that expanded out the side of each previous list but now it has reverted to what it was previously.

The single list approach just continues off the screen and is completely unusable past 43 categories.
And I can't seem to find any options that affect the category choice drop down.
Why is it not smaller and scrollable? Or why did it change from the previous nested drop downs?
I like to keep my torrents organised as it helps with the folder structure but if this doesn't start to get handled better I am gunna have to change torrent client

Add some separators to your categories.  When the menu pops up, there will be sub-menus that group everything between separators.  It is much easier to organize than the big long menu (which actually does scroll in Linux, just not Windows for some reason).