If a user has selected ‘watching’ for a category they’ll receive email notifications for every post in that category, unless they’re active on the site. If they set “Send me email notifications even when I am active on the site” in their email preferences, then they’ll receive email notifications even when they are active.
If I understand @tobiaseigen correctly he’s saying that he sets a certain category to ‘watching’ for all users, so they all receive notifications for that category.
Mailing list mode sends users an email for every post they have permissions to see on the site. So for active instances this can be a huge number of emails, and for diverse instances it can include a lot of irrelevant notifications.
Not that I know of.