My toolbar did not seem to update automatically and I was puzzled that some others were remarking on a new "News" icon, which was not new to me. I was at version 1.66, uninstalled, and reinstalled.
Now I don't get a category for my older site, which has been in Yahoo, etc since 1998 and is still in DMOZ under Top: Shopping: Weddings: Invitations and Announcements: RSVP Services
It is no longer in the Google Directory. May be a coincidence that I updated my toolbar.
What had happened is that I had an unrelated, popular resource at a lower level, which I moved to a new domain as I wanted to retire this RSVP domain. I put a 301 redirect and the resource is duly in the Directory at the new site. But could the 301 at the lower level wipe out my root entry in the unrelated subject area in the directory?
Since it is still in DMOZ, how will Google find it again?
I'm quite sure that your toolbar problem is unrelated to your problem with Google's directory.
Google Directory uses the data from DMOZ. However, DMOZ had problems making a so-called RDF dump starting from September last year. A few weeks ago DMOZ was able to make a new RDF dump and soon after the Google dance is over, the Google Directory will be updated as well. So if your site is still in DMOZ, in a few days or weeks, it will be in Google Directory too.