sub-cats not showing as children

i have the same problem. i wonder if it could be conflict with a special plugin. i have no idea now. all sub-categories are displayed as categories in the same unordered list.

oh i just found this infos and it worked for me:
infos

if fear you cannot really alter css. when in html all categories and subcategories are in ONE ul. not as it should be: ul li ul li close ul close ul 🙂

and this is the case.

Did you try:
http://wordpress.org/support/topic/31071#post-175672