Porting from EE - How to filter by category/segment in one template
/work/ecommerce-websites is giving you a 404 because there is no obvious place to route it. See http://buildwithcraft.com/docs/routing for details on how Craft tries to route each request that comes in.

You have 3 options:

GOOD: Create individual templates for each category

I’m not sure why you would want to do that, but it is an option, so I’m putting it here.

BETTER: Create a dynamic route

You can create a new dynamic route that tells Craft to point URLs that look something like “work/(slug)” to the “work” template, or you might be better off just creating a new “work/_category” template so that you don’t have a single template that is responsible for two entirely different types of pages, which is a little weird. (If there are similarities between the work index and a work category page, you should probably just create a new Work-specific layout template that outputs those things.)

BEST: Make these your primary category URLs

You said you have a category group set up, and the second segment is supposed to match one of them. If this is the primary place that you would expect to find info about these categories on your site, then go into Settings > Categories > [your group] and check the “Categories in this group have their own URLs” checkbox, and fill in the “Category URL Formats” and “Category Template” settings like so:



Then, double-click on each of your categories and make sure their Slugs are what you would expect the 2nd segments to be.

Here I’m expecting you’ve decided to create a “work/_category” template as suggested earlier, but if you really want your work index template to be handling these pages you can change the Category Template setting to just plain “work”.

As a bonus with this third approach, you won’t need to fetch your categories manually from the template; a category variable will already be available to the template, so you can go straight to outputting {{ category.title }} or whatever. (See step 4 on http://buildwithcraft.com/docs/routing).

This third technique also applies to sections/entries by the way. I mention that because based on your posted template code ({{ entry.websiteLink }}) it looks like you’re managing entry URLs manually with a custom field, which is really not necessary in Craft. Check the “Entries in this section have their own URLs” checkbox in your section’s settings and Craft will assign a primary URL to all the entries in your section, based on the URL Format you give it.