blog types vs site categories

I reckon both Blog types & Site categories are used to classify your subsites (blogs/websites) in a network into different categories.
Do they go in conjunction or do I use ONLY one of the 2 ?? How is one of them better than the other ?
I want to be able to classify my subsites into categories & allow admins to put their site in one of the above categories - either at the time of creating the site OR after.