This should clear things up:
"What are the operations over people categories?
The ability to fly over people varies depending on the level of risk that a small UAS operation presents to people on the ground. Operations over people are permitted subject to the following requirements:
- Category 1 small unmanned aircraft are permitted to operate over people, provided the small unmanned aircraft:
- Weigh 0.55 pounds or less, including everything that is on board or otherwise attached to the aircraft at the time of takeoff and throughout the duration of each operation.
- Contain no exposed rotating parts that would cause lacerations.
In addition, for Category 1 operations, no remote pilot in command may operate a small unmanned aircraft in sustained flight over open-air assemblies unless the operation is compliant with
Remote ID.
- Category 2 and Category 3 provide performance-based eligibility and operating requirements when conducting operations over people using unmanned aircraft that weigh more than .55 pounds but do not have an airworthiness certificate under part 21.
- In addition, for Category 2 operations, no remote pilot in command may operate a small unmanned aircraft in sustained flight over open-air assemblies unless the operation is compliant with Remote ID.
- Category 3 small UAS have further operating restrictions. A remote pilot in command may not operate a small unmanned aircraft over open-air assemblies of human beings. Additionally, a remote pilot in command may only operate a small unmanned aircraft over people if:
- The operation is within or over a closed- or restricted-access site and all people on site are on notice that a small UAS may fly over them; or
- The small unmanned aircraft does not maintain sustained flight over any person unless that person is participating directly in the operation or located under a covered structure or inside a stationary vehicle that can provide reasonable protection from a falling small unmanned aircraft.
- Category 4 operations is an addition from the NPRM. This category allows small unmanned aircraft issued an airworthiness certificate under part 21 to operate over people, so long as the operating limitations specified in the approved Flight Manual or as otherwise specified by the Administrator, do not prohibit operations over people. Additionally, no remote pilot in command may operate a small unmanned aircraft in sustained flight over open-air assemblies unless the operation is compliant with Remote ID. To preserve the continued airworthiness of the small unmanned aircraft and continue to meet a level of reliability that the FAA finds acceptable for operating over people in accordance with Category 4, additional requirements apply.
Note: Sustained flight over an open-air assembly includes hovering above the heads of persons gathered in an open-air assembly, flying back and forth over an open-air assembly, or circling above the assembly in such a way that the small unmanned aircraft remains above some part the assembly. ‘Sustained flight’ over an open-air assembly of people in a Category 1, 2, or 4 operation does not include a brief, one-time transiting over a portion of the assembled gathering, where the transit is merely incidental to a point-to-point operation unrelated to the assembly.
Operation over Moving Vehicles
In a change from the NPRM, the final rule permits operations over moving vehicles, provided the small unmanned aircraft operation meets the requirements of Category 1, 2 or 3
and either:
- The small unmanned aircraft must remain within or over a closed- or restricted-access site, and all people inside a moving vehicle within the closed- or restricted-access site must be on notice that a small unmanned aircraft may fly over them; or
- The small unmanned aircraft does not maintain sustained flight over moving vehicles.
A remote pilot may also conduct operations over moving vehicles with a small unmanned aircraft eligible for Category 4 operations as long as the applicable operating limitations in the approved Flight Manual or as otherwise specified by the Administrator do not prohibit such operation.
Night Operations
This rule allows routine operations of small UAS, beginning April 21, 2021, at night under two conditions:
- The remote pilot in command must complete an updated initial knowledge test or online recurrent training, and
- The small unmanned aircraft must have lighted anti-collision lighting visible for at least three (3) statute miles that has a flash rate sufficient to avoid a collision."
. I never thought that testing my drone indoors would "ingest" a long hair. But it did. It would probably still fly, but would make the motor work so much harder. It was a pain to get the hair cleared out of there. 
