From Natalie's answer -- but to help anyone else that is trying to do this:
1. Add the new category on the profile. (You have already checked to make sure it is not already a category by using the category button above the biography.) Format it correctly according to the guidelines. In Carlesta Armstrong's case it was [[Category: Palestine Cemetery, Palestine, Ohio]]
2. Click on the red category you just made -- In Carlesta Armstrong's example it was [[Category: Palestine Cemetery, Palestine, Ohio]].
3. You will see a text-edit box: Add the categories: [[Category: County, State, Cemeteries]] AND [[Category: City/Town, State]] to the text-edit box. Preview if you want. Save your work.
Now, pat yourself on the back!