Does this mean no one has looked at the list of sites that were submitted to this category or does it mean ours wasn't accepted?
No. It means the category was last changed on that date.
You don't know what change was made on that date. It might have been an automated removal of a dead link. It might have been a site added there because of work done in some other category. It might have been an editor correcting some common misspelling throughout the directory. It might have been a site added based on Google searches, or URLs found somewhere in the real world. (It could even have been someone reviewing one or more site suggestions in that category and adding some of the suggested sites to that category. But that's certainly not the most common kind of editing activity.)
And you don't know how much time an editor has spent doing other things that could potentially have benefited the category (but, as it happened, didn't help.) The editor might have done Google searches, reviewed other linked lists, or reviewed suggestions--and it just happened that all the interesting sites found, were either already listed, or fit better in some other category. (This happens a LOT. You start out looking for information about a hymnwriter in another country, and you end up building a category for a city park in your parent's hometown. You start out looking for information about a state park--and people who visit state parks have such varied interests....
Editing isn't bottlewashing: ("your bottle is third in the stack of VERY dirty bottles to wash, and if business is good we're going to be hiring a heavy-duty bottle-washer before the beginning of next quarter.") It's exploration ("last seen, Dr. Livingstone was headed in that direction, but whether he stopped to convert another tribe, or changed direction to fight an epidemic, or was blocked by impassible swamps, or was transported elsewhere by alien technology, or died in an outbreak of peaceful agrarian land reform, we really don't know.")
