SEF URL limitations with Views Page Display

Hello,

I'm finding Drupal difficult to create SEO friendly urls when using the Page display with arguments.

For example, when trying to build a business listing directory we would like the urls to be in the following pattern.
arguments enclosed in *

domain.com/*city*/*category*
-Page list all subcategories of the 2nd argument (children of the category taxonomy term)

domain.com/*city*/*sub-category*
-Page list nodes in a particular city and subcategory (nodes assigned to a particular category and city taxonomy term)

City, Category, and Sub-Category are all arguments that need to be processed by the view to get the correct results

Views Page display doesn't allow the initial argument in a Page path to be a dynamic (%) using the placeholder %.
Also because our path includes the same number of arguments we have to include seperate static placeholders at the end of the View Page path to differentiate between the 2 Views.

We've resolved to letting the URL have the following pattern, which is not ideal.
domain.com/directory/*city*/*category*/statictext
domain.com/directory/*city*/*sub-category*/statictext2

Is their a best practice to achieve the URL's we need?
Is there something I'm missing in regards to view to create the SEF urls we need?
Is Views not the right component for the job?