I provide an XLS using your prescribed fields and for the most part the Product Import works. I have the column titles on the first row.

All of the products have a category but no subcategory. Looking at the database after the load it appears that a blank subcategory is created under the first category and all subsequent products are assigned that subcategory as well as the category on the line.

This is what happens when the subcategory column contains blanks.

How do I prevent this fake subcategory from being created and then assigned to every product?