There's not many use cases I come across where the 'nested' data is the only instance of that data. A student record might have some nested class information,

There's not many use cases I come across where the 'nested' data is the only instance of that data. A student record might have some nested class information, but the class information itself lives as a master someplace else. If you nest things, you now have data living in multiple places, no? Updates need to update multiple locations, which would potentially introduce lots of errors. I've got a handful of situations where nested structures are making sense, but it doesn't seem to be the norm (at least in the data worlds I work in).