I'm at a client site today, finishing up a MOSS 2007 intranet for launch this week. I just viewed the Categories tab on the client's Site Directory when logged in as an end-user. We customized the categories to reflect the organization, and filled them out with links for each division. As an admin I can see five links under a particular division, however the end user could not see any of them.
The Sites list (which can be found under the Site Directory tab, by choosing View All Site Content) can be manually built to include links either inside or outside your intranet, but also receives automatic entries anytime someone creates a site and checks "List this new site in the site directory."
These entries go into a "Pending" state even if they're created by an admin (which could be defined as in the "Owners" group, and/or having Full Control rights over the site, and/or a Site Collection Adminstrator). The result is that only admins can see the Pending links. If there are content owners with Manage Hierarchy rights who are out there creating sites, the admins have no way of knowing when new links have been added to the Sites list. The Site Directory is being populated but none of the end users will be able to see the additions.
To ensure that your Site Directory is up-to-date and useful, set an alert on the Sites list to notify at least one of your site administrators when a new link is added. This seems like simple common sense, but my thought in posting this is that if it hasn't occurred to me in 2+ years of working with MOSS 2007, there's a chance that others have missed it as well.