The last time I checked, most sugar is really dry (unless it's something like brown sugar). So why is it categorized as "wet"?
Sugar is not really a wet ingredient, it's just treated as one in certain types of baking (i.e. cakes).
When making a cake or other "fluffy" baked good, you want a fairly small amount of gluten to be produced, otherwise you'll get a chewy texture instead, and you definitely don't want a cake to be chewy like bread.
Dissolving sugar in the water inhibits the gluten-forming proteins. It's a method (actually, the method) of adding more liquid to the mix without getting a tough, chewy cake. It is for this reason that sugar is considered a "wet ingredient" - because the process only works properly if you add it with the water, not with the other dry ingredients.
It's even possible for sugar to be a dry and wet ingredient in the same recipe; you might add just enough sugar to the water to get the right texture, and add more to the dry ingredients for further sweetening.
Aaronut's answer explains role of sugar well, but here one more explanation about the ontology side of the question. No, it's not new, but when said in different words, it can make more sense.
Just stop thinking of "wet" and "dry" ingredients. What we have is a method of making cakes which requires two separate intermediate mixtures to be mixed in one final step. Home cooks are not process engineers, so they did not describe it as "intermediate product A" and "intermediate product B" or whatever you have. They also didn't feel like saying "This goes into the bowl which will hold a liquid when it's ready for the final mix" and "This goes into the bowl which will hold a powder when it's ready for the final mix". They just used a shortcut and called it "wet" and "dry" ingredients, because each of them is part of the final wet intermediate ingredient or the final dry intermediate ingredient.
Of course this is totally confusing for a novice baker. But domain specific terms are created by experts, not novices, and to them, it is more important to have a short way of labeling the ingredients than to have a nomenclature understandable for non-experts. You just have to get accustomed to the usage.
I'm not sure what the context is, but I dug up this article that mentions sugar being a wet ingredient when baking certain items such as cake. A quick summary from the article:
"...the general idea is that Sugar and Water are Best Friends Forever, and they swear that nothing will ever separate them."
I'm guessing basically sugar is used with water (as opposed to being kept undissolved as a solid) so much that this is why it is considered 'wet,' at least in the context the article talks about.
Hope this helps!