my pages are structured from an assembly of various .shtml files
Long term, you can add a lot of functionality very easily by swapping to PHP includes.
As there are often multiple ways to reach a particular product, having all the categories in the URL would lead to duplicate content issues. I have sites with quite deep folder structures (as seen from a URL perspective) of (dynamically generated) categories. Those folders point to product pages in the root or in a single products folder. The URLs for products are short with basic product identifying words. Each product page links back to ALL of the category trees that link to it, so there's multiple breadcrumb trails per product. There's multiple tree structures of categories to reach a product and these are crosslinked on the single product page per product.
Site structure does not have to be the same as URL structure. :)