Actually, this isn't complicated at all.
Categories are created in your WordPress control panel (Dashboard, if you prefer) under "Posts". You can see the menu option until you click posts.
Once you click on Categories you can add a category. To make it a sub category (or child) just use the Category Parent drop down box to choose the higher level. To make a sub-sub-category choose on of the subcategories as the parent and so on.
Same thing with Pages. Click Add New and on the right hand side you'll see an option to select the parent page.
If you are using HubPages to build links to your WordPress blog you might want to make sure you get a 75 author ranking to avoid Hubpages Nofollowing your links - https://hubpages.com/technology/HubPages-Nofollow