Is it possible to make is_category() recursive?

Note that is_category() accepts a category ID, name, slug, or array of such, so you could actually simply use is_category( array( 'Lumber', 'Domestic Hardwoods' ) ) instead of having to call is_category() twice.

But as for what you asked, is_category() does not support that, however, what you are trying to do can be achieved like so, which uses get_term_children():

if ( ! is_admin() && $query->is_main_query() && $query->is_category() ) {
    $current_cat = get_queried_object();
    // replace 'parent' with the correct category slug
    $parent_cat  = get_term_by( 'slug', 'parent', 'category' );
//  $parent_cat  = get_term_by( 'name', 'Parent', 'category' );
//  $parent_cat  = get_term( 123 );

    // Get the child categories/IDs.
    $children = get_term_children( $parent_cat->term_id, 'category' );

    $cat_ids = array_merge( array( $parent_cat->term_id ), $children );

    // Check whether it's the parent category's archive or its children's.
    if ( in_array( $current_cat->term_id, $cat_ids ) ) {
        // put your awesome code here...

So the only hard-coded database value is the parent category’s slug, but you can also use its name or ID, if you want to.