Categories.app is insistent on using a cached icon I don't even have on my iPhone anymore, and I can't figure out how to get it to use a different icon!!

Can someone please let me know what file/directory needs it's permissions changed, or which cache file (and where) I should perhaps remove from my phone so that I can fix this issue one and for all!

I am having the same problem. I SSH'd the update notes out of the /applications directory and it said there is a new naming convention for versions 2.29 and up that messes up old icon files. If you want to get rid of it you should delete it from the app and start over. Let me know if you find out more