Has there been any resolution to this problem? Maybe in 2.0?

I've been playing with this trying to figure it out.

Template without Master
- Page Manager Here
(This works, obviously.)

Master1
- Page Manager Here
- Template uses Master1
(This works.)

Master1
- Template uses Master1
- - Page Manager Here
(This works.)

Master1
- Page Manager Here
- Master2 uses Master1
- - Template Users Master2
(Page Manager Fails - No edit regions)

Master1
- Master2 users Master1
- Page Manager Here
- - Template uses Master2
(Page Manager Fails - No edit regions)

Master1
- Master2 users Master1
- - Template uses Master2
- - - Page Manager Here
(Page Manager Fails - No edit regions)

Now, the most interesting aspect of this is that the ONLY time the page manager fails is if the page is at the root level of the site tree. The test results above are for /Products. When I run the same battery of tests on /Products/ProductA, ALL of the above cases work fine.

Nested master pages are one of my favorite features of .NET 2.0 and I would love to use them, but until this problem is resolved, I'll have to figure out another way.