Topics are contextual groupings of like items. Multiple topics  can be
associated with single items, and so far from my use of the feature it
appears to be a way to group content together that does not live
together. For instance, you might have 5 different areas on your site
that each have a policies document  that pertains to that area. By
creating a topic  of Policies you can group all 5 policy documents
together.

I didn't use SPS v1, so I am unsure how the categories  feature worked,
but it does sound like the Topics feature in SPS v2.

I got a small  query on this,
Is there a way of automatically adding to the “Topics” from a subsite?
For instance if I have a document  workspace in a subsite called Management
Docs, is there a way of directly adding a document from the workspace  to a
topic in the portal home?