[Usability] Looking for advice - UI pattern - editable, reorderable lists

[Toms <toms baugis gmail com>]

I've been breaking my head for a while now so i thought maybe somebody has better idea.

Screen under question: http://projecthamster.files.wordpress.com/2008/03/categories1.png
You can see there entries, that are put into categories. User should be able to edit names and change order and category.

Changing categories is performed via drag and drop, ordering within category can be done either with arrows in toolbar, or again, with drag and drop.

The problem is that reordering with drag'n'drop becomes extremely difficult when editing is turned on (standart GTK editable column that sets to edit mode on the click after selecting - similar to what you can see in evolutions todo list).

Also the editing of tree doesn't feel natural, but that's a completely different topic.

So, back to problem - i expect to have something like 2-7 categories, in each having about 3-7 entries.

My ideas so far:

a) Drop the two lists, and make in into a tree. That doesn't solve editing problem
b) Create new column that would be intended for dragging, change mouse cursor on hover accordingly
c) Turn it all into plain text lists with headings - people know how to write lists in documents, this solution should be extremely friendly, i think, but somewhat unusual (code.google.com tends to go in that direction). The only trouble would be to go from previous state to the new one in the code.
d) turn categories into colored boxes, kind of 2D approach
e) ...

It could be that i'm trying to approach the problem from wrong perspective - any feedback will be appreciated!

Regards,
Tom