It's not forbidden to have nested if statements.  What's going inside the if statements, though, could cause trouble.  I'd try a simple assignment, such as:
Code:

if (x > 0) begin
  if (x > 10)
    y = 6;
  else
    y = 8;
end else begin
  y = 0;
end
I(out) <+ y; 

and see if your simulator has trouble with that.

Another thing to watch out for is making sure you've got your "else" associated with the correct "if" -- indentation is not significant, so:
Code:

if (x > 0)
  if (x > 10)
    y = 6;
else
  y = 8; 

the "else" on line 4 corresponds with the "if" on line 2, not the line 1 that it's indented to match.