Interesting idea. One note: sometimes after I connect two items it'll reselect the combined item, sometimes it won't. I'd prefer if it never did, but at least if it was consistent I could get used to having to click "Deselect" each time...

EDIT: Also, would be helpful if the items where I've created a category were somehow grouped (column on the left?) so when I find a third item, it's easier to find the ones I'd already joined.