First it says that the rankings are done by popularity and the yahoo definition says the following: By Popularity: By default, Directory site listings are presented sorted by popularity and relevance. Sites that are most popular with users or the most relevant to the category appear at the top of the site listings. The order of websites or web documents is based upon Yahoo! Search Technology. If the category is large, the listings display over multiple pages with pagination displayed at bottom of the page. What popularity and relevance?? Is this the amount of SE traffic yahoo sends you or how many people click on it from the directory listing? Second; Would my site be best in this category(site is in sig): http://dir.yahoo.com/Recreation/Sports/Gambling/ (high LV) or this one: http://dir.yahoo.com/Business_and_Economy/Shopping_and_Services/Sports/Gambling/Handicapping/ since both are fitting but one only has one listing and wouldnt like for it to not be accepted if they feel its the wrong category.
Can't tell you how they measure "popularity"... but on categorization I'd bet on the Handicapping cat. Just a better fit. Doubt they'd turn you down regardless of which you submit to... if the site otherwise is considered acceptable they'd probably move it if they felt a different category was better.
Different companies, different methods of ranking. Welcome to the internet where one size doesnt always fit all. Look at the bright side... everyone builds pages aimed at Google's algorithm today. There was a time (before the major dominance of Google... yes, that was once reality) when you had to decide whether to optimize for Netscape, Alta Vista, Yahoo, AOL, Lycos, or the new kid with the funny name... Google. It's simpler today, with a single SE in the lead by a far margin, but it isn't absolutely devoid of conflict.