I am having the same problem. Is this a temporary Yahoo problem? I’ve had it before. Help!

If you have a “specific”category already set up—-as you say—-all you have to do is enter the category name in the address field and Yahoo sends it to all the names in that category.
You don’t need to click “check all”—-or “insert checked” when dealing with categories. That would abort the purpose of a category.

Yahoo has (just lately) reduced the number of addresses per mail—so if the category exceeds that number, you would get a notice saying—”too many addresses–unable to send”.
In that case—break it into smaller bunches.