Hi, I can't reproduce your problem on a clean joomla with JEM.
I think your problem has to do with your JEMsettings in User control >AC-Events.. and in Groups>your group>settings
(I agree, (and this seems new) creating in frontend an event, you see all categories, but, when you try to save within a non-allowed category, then you you get an error notice. That's not so good!)