Editors are most certainly allowed to add their own sites to a category/categories they have editing permissions in, provided the site/sites belong in that category, and have the unique content that's looked for on any other site.
No, they are not allowed to "Cool" their own sites at all, or any other site that doesn't represent the best in that category.
If you believe an editor is behaving misappropriately, file an abuse form and it will be looked into, such things are not tolerated.