How to show all the posts from a particualar category in sidebar?

Alternatively you could do it the way I am doing it on my blog at http://bachutha.com,

The code in the widget is:-

<p><h2>The Bread Diaries Content</h2><p>
<div style="height: 550px; width: 270px; font: 14px/16px Times Roman; overflow: scroll; background-color: white; ">
<script type="text/javascript" src="http://bachutha.com/bdlinkarrayB.js"></script>
</div>

The scroll term in the div tags enables scrolling. The javascript file a list of <a href="...> tags that is converted to java script as shown in my FAQ page http://bachutha.com/faq/ item 13 and 15. So you can list all your post or have several different widgets for different files.