functionality exists for this and is called 'exclude' categories (rather than 'hide').
otherwise, if you want a site-wide function, there's plugins for this:
in case anyone else comes across this post:
using the term 'exclude' should help search the forum archives and the codex. i like to use google to search using the site: option, like this:
i would have added a how-to, but i don't know from which tag you want to exlucde a category. depending on which tag you are modifying, the exclude code is different. check each tag in the codex.
for example: there are even two ways of listing categories:
<?php wp_list_cats(); ?>
<?php list_cats(); ?>