While it doesn't have category, you can name he avatars properly so that similar avatars have same prefix. This way they will be listed in group as the default sorting is by file name.
Awesome add-on, can you just make a picture showcasing the need to add your own images please. It will help and do you think you will be making a image pack for this add-on?
Would like support subdirectories of avatars and had some trouble setting it up (the "avatars" directory needs full write permissions) but otherwise does a great job of replicating a basic feature of other software.