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I'm mildly proud of how I categorise my games on Steam and interested to see others' methods
(feddit.nl)
They're in order of likelihood of being played. Craig is a mate of mine who I play with when time permits.
This is how I go about it, too. I also use the favourites feature to self-curate games to reduce choice anxiety when I want to play something.
Whenever I buy a game, it gets favourited, whenever I'm done with a game, it gets unfavorited.
If I play some game a lot or feel like playing some game when I have time, I favourite it.
This way anytime I want to play, I have a short list of games to consider, instead of trying to look through my whole library.
yea I do also use the favorites (and two other manual lists), but thats about it. Mostly I just use the "last played" view of the library and hide games which aren't installed locally.