I am trying to make a nested block reference and a quick forum search uncovered that I should be able to drag and drop the block while holding down shift-option. This doesn’t work for me. I can drag and drop while holding the option key successfully, but that only results in the top block being referenced, and none of the sub-blocks.
I’ve run into the same problem. The trick is to first hold option, click and start dragging, and then also hold shift right before you release.
Option-Click -> Drag -> Also hold
Shift -> Release