It shows the last time an editor did a change to the category you are looking at, whatever change that might have been. Addng, deleting, chaning a listing. Adding, changing, deleting information such as related categories / category in other languages / ... - Basically everything that triggers a regeneration of the HTML page (Public pages are not driven by a database but precompiled statc HTML, since this needs much less server power)
is it possible that websites could have been added to this category since May 17th but they are just not displayed yet?
Our frontend servers (
www.dmoz.org) are cached for several days to reduce the load on our main machine, so changes due to the last few days might not be visible (or only visible on some of our public servers). Additionally to our server side caching, you might see a page cached by your browser.
Apart from that, our software might be "behind" due to lots of changes (which happens once every few months) and the changed page might still be queued for regeneration.
Apart from those reasons: No,that's not possible. And note that the date always matches the content you see.
I read on a page somewhere that the search engine itself is updated independently of the categories
That's true, but as you already assumed it's not much related.