Categories not displaying as nested in control panel
So, there's no mention of this in the v3 docs that I could see.

I went back to an older project where I'd used categories to find that I set the Category URI format field to {% if object.level == 1 %}read/category/{slug}{% else %}{parent.uri}/{slug}{% endif %}

This was obviously documented at some point for me to implement it on what would have been an original Craft install.

There's no mention of this being needed to enabled nested categories on https://docs.craftcms.com/v3/categories.html#category-groups so it should get added.