Yes, I know nesting is evil. I think Premiere Pro has been gaslighting me.
I have a different nesting problem with effects -- they are applied twice it seems. Specifically, the Lumetri adjustment in the container sequence now looks blown out. But if I drag the edited clump directly into the container sequence, it looks as expected. You can see the nested one in white/red, and the edited clump to the left. I'm using an old version of Premiere Pro as I have too many moving parts to update now, and I'm not convinced the problem/bug is fixed, anyway.
I thought it might be caused when the Lumetri Effect was applied to the master, not the instance. But I tested that, and no change.
Any suggestions are welcome! Other than "nesting stinks, why bother?" 😃