Ok So I decided to use the recursive option and added Jquery to it.

Here is my code:

private void LoadData()
        {
            Node rootNode = new Node(1122);
            StringBuilder sb = new StringBuilder();
            sb.Append("<ul id='example'>");
            DoIt(rootNode, sb);
            sb.Append("</ul>");
            Panel1.Controls.Add(new LiteralControl(sb.ToString()));

        }

        private void DoIt(Node node, StringBuilder sb)
        {

            foreach (Node ChildNode in node.Children)
            {
                string strChecked = "";
                sb.Append("<li>");
                if (CategoryManager.HasRelation(this.CurrentMemebrID, ChildNode.Id))
                    strChecked = "checked='checked'";
                else
                    strChecked = "";
                sb.Append("<input type='checkbox' value='" + ChildNode.Id + "'" + strChecked + " name='CategoryTree' id='" + ChildNode.Id + "'>");
                sb.Append(ChildNode.Name);

                if (ChildNode.Children.Count > 0)
                {
                    sb.Append("<ul>");
                    DoIt(ChildNode, sb);
                    sb.Append("</ul>");
                }

                sb.Append("</li>");
            }
        }