Display of child categories on the weblink directory default page

I think the display of categories on the weblink directory page is a bit confusing when there is more than one level of sub-categories present. The normal method of display should be to only show 1 level of children and not to display grandchildren.

So in a hierarchy like this:

Drink
* Alcohol
** Beer
** Wine
* Pop
** Colas
** Club soda
** Seltzer
* Milk

weblink.module would show this (all descendents, children, grandchildren, etc.):

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Drink
Alcohol, Beer, Wine, Pop, Colas, Club soda, Seltzer, Milk

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It should only show children and the grandchildren categories should appear on the sub-category pages. So the Drink page would look like this:

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Drink
Alcohol, Pop, Milk

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And the Pop page would look like this:

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<- Back to Topics
<- Back to parent category, Drink

Pop
Colas, Club soda, Seltzer

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The confusion becomes apparent when there are multiple subcategories in a taxonomy. The user is expecting alphabetic order for the subcategories, but when there are multiple sets of grandchildren interfiled with the subcategories, visual scanning becomes difficult. See for example my weblink directory. A bit more than most people would do, but in an enterprise setting or on a large site (think Yahoo!), these kinds of hierarchies are expected.

I would recommend showing only the 1st level of subcategories on the default directory page using the model above. I would be happy to help further with the design of this is needed.

-Michael