not sure if this will work for you .. but try this:
{if $config.General.root_categories eq "Y"}
<table cellspacing=0 cellpadding=1 border=0>
{foreach from=$categories item=v}
<tr>
<td width=1>[img]{$ImagesDir}/spacer.gif[/img]</td>
<td height=12>
[img]../icon.php?categoryid={$v.categoryid}[/img]</td>
</tr>
{foreach from=$v.childs item=c}
<tr>
<td></td>
<td>
<font class=CategoriesList>{$c.category_name|escape}</font></td>
</tr>
{/foreach}
<tr>
<td colspan=2></td>
</tr>
{/foreach}
</table>
{/if}