Hi,
The "categories on 2 levels" module that is installed by default with HikaShop is already configured as on our demo website and thus should work properly to reproduce the same function.
If it doesn't, it either means that you change something in its settings, or that your category tree is messed up.
Please provide screenshots of your categories listing in the backend, of the settings of your module and a link to the page where the module displays and we should be able to tell you what's wrong.