You actually need to edit skin1/customer/main/subcategories.tpl
And swap these 2 lines around:
{if ($navigation_page eq "")||($navigation_page eq "1")}{$current_category.description}<p />{/if}
{capture name=dialog}
so that it says:
{capture name=dialog}
{if ($navigation_page eq "")||($navigation_page eq "1")}{$current_category.description}<p />{/if}
That way, the description will appear below the title - ie inside dialog.tpl