Categories are subject “tags”. They are the means by which others can find your posts and read them. If you want a “private” blog designed so that no one will ever lay eyes on your posts then this thread will be useful http://wordpress.com/blog/2006/08/04/private-blogs/.
This probably didn’t come to your mind but if you do not drop and drag the category widget into your sidebar then you will not have to see it’s contents, right?
I also note that your “handle” is not linked to a wordpress.com blog. If the case is that your blog is self hosted on your own server or web hosted then you are in the wrong forum and actually ought to be asking your question over here http://wordpress.org/support.
‘Posted in’ is hardcoded by the theme and wordpress. With the setup we have here, there’s no way that they can be removed. If you grabbed the WordPress software and hosted with a webhost, you would be able to remove them as you would have complete control over the files. With the shared environment we have here, you would be changing the line for everybody.
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