Categories issue in first sidebar widget

Hi Caroline, thanks for a great theme. I’m not a developer or anything, so I am using your theme as is – which looks so good, I think – but I am having a problem linking to my posts from the categories menu. I have ‘categories’ in my first sidebar, and posts categorised accordingly, but when you click on one of those categories in the sidebar, it won’t link to any of the relevant posts; it just gives me the 404 not found message?

Please help, I really need this to work and a tag cloud doesn’t substitute for categories. If I don’t make sense, please see what I mean at tonguetied.co.za (the site is practically emprty because I am just setting it up.) Thanks.