http://www.shoppingcartsinravines.com being the site in question...
When I upgraded to 2.3.1, I immediately noticed my sidebar Category listings be replaced with an error, but I figured out that that was due to the Fold Category List plugin ( http://www.webspaceworks.com/resources/cat/wp-plugins/31/ ) no longer being functional, since apparently the categories got merged into some other part of the database instead of having their own thing?
I'll wait on the author to fix that, but in the meantime I went to a basic category listing... assuming that a simple wp_list_categories() would return my categories, in alphabetical order, with the only parent amongst them ('Society') containing its child categories as another sub-list.
Instead, I got all of the categories listed alphabetically without indication of hierarchy, with the exception of two child categories which were sub-listed properly... no clue why.
I decided to just nix all the child categories entirely for now, but it's really only an aesthetic solution because there's a lot of stuff there that now can't be properly organized/accessed.
The weirdest part of this mess is that when I go to my Manage > Categories page, NONE of the child categories show up at all... it's like the WP backend doesn't even realize they exist, even though it still makes a failed attempt at organizing them into a list when asked to do so, and even though posts are still contained within those categories, the categories are available on the Write page and the pages for each category can be accessed via the links at the bottom of relevant posts.