Categories hold either Categories or Products but never both at the same time ...
Do this ...
Backup your database via phpMyAdmin ...
In the SQL enter:
UPDATE products_to_categories set categories_id=1 where categories_id=0
Now go to your Zen Cart Admin ...
Go to Catalog ... Categories/Products ...
You should see the New Category button ...
Add a Category ...
If this comes up as categories_id 1 then all Products will be in there ...
If this is the case, go to the Tools ... Store Manager ... and run the:
Update Master Categories ID ...
Update Products Price Sorter ...
Now, you can make your Categories etc. and move these Products into the right Categories ...
IF this did not work ... then we have to tweak a bit more ...