Symptoms

If you use PandD to create a package, and you select JUST the category (And you don't expand the category), the items IN that category does not get added to the package. It adds just the category.
 

Diagnoses

I was able to reproduce the issue and it has been identified as a bug.
 

Resolution

I have routed the ticket to the LABS support team for investigations and the engineer working the ticket has linked the ticket to an existing TFS item. This issue should be addressed in a future build.