Hey @ewoolery thanks for reaching out, it looks like you were referencing the Published On date field from your Category collection. So the date would only change based upon the "Published On" date from your Category collection. Instead if you scroll a little further down you'll see the Published on field to connect to. Here's a screen recording on how to change the Published on date (which it looks like you've already configured correctly) and change the sort/order of your dynamic list items.
Please let me know if this is helpful, if not, I'm happy to help further.