How can we reconcile the Hadith, "Every child is born upon Fitra (natural disposition)..." with the Hadith, "Behold, this world is sweet and green... Behold, the children of Adam were created in various categories..."?

The first hadith (definition) is agreed upon, and the second is weak. Assuming its authenticity, there is no contradiction between them. The first hadith means that every child is born predisposed to Islam, so if their parents are Muslim, they continue in Islam. As for the seemingly contradictory part in the second hadith, "And some are born disbelievers and live as disbelievers," it means that whoever is born to disbelieving parents and persists in disbelief after reaching the age of accountability is treated as a disbeliever.