If it's the last item you have highlighted, that is an internal category that cannot be deleted (Quicken will disallow). Any category that begins with _ is internal and can be hidden if not needed.
I think you found the damaged category. In my file the group assigned is Rental Property Expenses. I was able to create a custom group called Test and then assign that category to Test. I could then remove it from Test and it changed back to the default.You might try playing with that. If you are lucky, it might change to the correct default group. Run the validation to see if it still shows damaged. In any case you might have to live with it. Your file is in pretty good shape now. If you don't use that category, it will probably never cause an issue.
I'd do one final Copy without the shift key and then use the Copy. You may yet stumble into the damaged category, but I'm out of suggestions.If you encounter the Reminders errors again, currently the only way to fix errors that super-validation does not fix is to manually delete all reminders one-by-one and close/open Quicken. Then re-enter them.