It's legit for two categories to have the same name when they're in different parts of a hierarchy:
Foo A
Foo Parent - Foo A
The importer gets this wrong however. It inserts both categories with the correct names and parents, but posts in the second cat will incorrectly be assigned to the first on import.
The 'Category name clash' post in this import file reproduces the problem. It should be in the Foo Parent - Foo A category, not the top level Foo A category.
http://svn.automattic.com/wordpress-tests/wp-testdata/export/asdftestblog1.2007-12-10.xml
