Sub Categories/permalinks

Hello.

I am wanting to put sub categories under my categories.
By this I mean I want ‘Show and Shine’ under the events categories in my portfolio http://roxi-lola.co.uk/?page_id=2560 and not show in my portfolio main page.

I also want to change the links so my portfolio is http://roxi-lola.co.uk/portfolio instead of http://roxi-lola.co.uk/?page_id=2560 and the posts with their post names ie ‘Nature’ rather than their post id. When I change this it then makes the portfolio page content not found and I can’t seem to work out how to sort it since these are all linked via categories.

Thanks in advance!