It is a pity to see that development of this great extension is terminated (or suspended).
I'm implement this future request in one of my project. If someone interesting (and author off course!) I'll attach patch to implement tree category structure. Modification is complex, and some words at beginning:
1) Implement categories free tree structure for infinity depth tree.
Some words about implementation. Off course it may be based on Adjacency List and depth in 2-4 should be enought for 95-55 percent of cases as I think. But in this case most of logic will not so transparent and implemented in PHP. In case do not use special tools for that and testing it is not very good idea.
Current implementation based on Nested Sets algorithm as widely spread, universal and very convenient for often select statements. To handle insert/updates/deletes more deficiently and errors free, and also encapsulate all logic in database layer I use approach based on trigger-implementation kindly present by Sergey Tomulevich ala (Phoenix) -
habrahabr.ru/blogs/mysql/63883/ (article in Russian language, but most of that is trigger listings). Sergey, very thanks.
2) Also gone menu_categories_row setting - it is not really what intended. It is used to calculate fixed tab width only. And if it is really will needed should be resurrected in according name. But I think width should be set in CSS, not directly in markup.
3) Height on hs_topmenu (hs_cont) now set ah min-height instead of height to allow grow to category structure.
4) Modification is quite integral. I only made and test it for default scheme! default_old, slider etc. does not supported! To do not make any illusions delete files:
components/com_hotspots/views/all/tmpl/slider_old.css
components/com_hotspots/views/all/tmpl/default_old.php
components/com_hotspots/views/all/tmpl/slider.css
components/com_hotspots/views/all/tmpl/default_old.css
components/com_hotspots/views/all/tmpl/default_slider_old.php
components/com_hotspots/views/all/tmpl/default_slider.php
WARNING: I provide only patch and DO NOT SUPPORT this modification in any fashion. If you are not developer, I think it still is not for you - best way wait until it (may) be revisited and included in release. If you meantime have question - feel free ask its.