sorry dude, but this is not working here (JOOMLA 1.7.2 JEVENTS 2.0.10)
Apply all cats to user TESS
user tess has permissions to create events in frontend, but he cant select eny other cat that the "DEFAULT". User Tess is in the group "registered". This group has Joomla-rights to create new events.
In each cat user Tess is Admin and has Joomla right to create, edit, delete + publish/Manage Events