Yes, -1 = 100% for 1 item, and -10 = 100% for 10 items, etc. That subtable just means 85% for nothing, 7% for 1 item, 8% for 2 items. Make sure those numbers add up to 100.
Object category numbers are: weighted chance, common, uncommon, rare, epic/legendary/divine, and then three zeroes which don't do anything. Epic/legendary/divine all use the same number and just the player level to determine when legendary and divines start appearing (level 8 and 15 respectively.)
So:
object category "TwoHandedAxe",70,0,0,0,100,0,0,0
is basically a 70% weighted chance for an epic+ weighted item. But note that it's not really a 70%, but more of a weighting. You could have several object categories within one table and those weighting can add up to above 100. But it's easiest to just make them add to 100 so the distribution is obvious within that chance is obvious. Larian often doesn't do that, for example in the subtable I think you pulled that example from:
new subtable "1,1" // 1,1 is another way to say a guaranteed chance for 1 item,
object category "Sword",70,0,0,0,100,0,0,0
object category "Axe",70,0,0,0,100,0,0,0
object category "Club",60,0,0,0,100,0,0,0
object category "Dagger",200,0,0,0,100,0,0,0
object category "TwoHandedAxe",70,0,0,0,100,0,0,0
object category "TwoHandedSword",70,0,0,0,100,0,0,0
object category "Spear",60,0,0,0,100,0,0,0
object category "Staff",100,0,0,0,100,0,0,0
object category "Wand",150,0,0,0,100,0,0,0
object category "Bow",100,0,0,0,100,0,0,0
object category "Crossbow",100,0,0,0,100,0,0,0
object category "Shield",150,0,0,0,100,0,0,0
I don't quite understand your third question. Maybe the explanation of the object category stuff explains that? They don't have specific epic or divine subtable categories (like ST_WeaponEpic) because player level determines when those appear, and epic, divine, and legendary all use the 5th number in the object category.
You don't have to repack your stuff into Main for it to work. Just put it in the same folder structure. Although, with the mod menu back, maybe packing it into a mod will let that work, but don't quite know all that works. For all intents and purposes, putting the mod as a folder in your game data folder seems to work fine, if not much better than the mod menu in the original. But maybe they'll improve the mod menu once the editor and steam workshop comes out.