I want to enable users to be able to edit there own items and publish to one or two categories. I have found how to do this in K2 User groups. What I am not finding a solution for is how to restrict the choice of HTML Editors available and then how to restrict users ability to browse through the files on the server.

I'm sure many sites out there do this and you understand exactly want I'm looking to achieve. I know about JCE Administration Tools but can't pull it all together.

The Blog Post above on this page has exactly the required functions I'm looking for, just need the documentation how it was setup with user controls

What I'm looking for a multi-author website with pretty much the same limitations as this website. The main function I don't know the answer for is how to restrict access to files locations when adding images to items.

Some progress, my site also uses JOmsocial and the my photos button in editors restricts editors to their own jomsocial photo albums. This is ideal