Nested groups folders

I think I’ve answered my own question.

Yes, the Group Folders app appears to support nested folders with different permissions set at the sub-folder level within a groups folder.

As an admin enable “advanced permissions” at the top level group folder.

This will then allow the group folder owner/admin to create subfolders with different permissions on any subfolders in the group folders app configuration.

nextcloud/groupfolders: :file_folder::family_woman_woman_girl_boy: Admin-configured folders shared by everyone in a group or team. https://github.com/nextcloud-releases/groupfolders

Using ACL is possible. But you don’t need ACL to create nested groupfolders.
Just add additional groupfolders as subfolder of the existing one (within admin settings). That’s it.