The final example of the DnD statt sheet makes me think whether it's legal to nest <dl>s?

I.e. can we do

    <dl>
      <dt>Actions</dt>
      <dd><dl>...</dl></dd>
    </dl>

Yes. Any flow content is permitted inside a <dd>. See:

https://html.spec.whatwg.org/#the-dd-element

https://developer.mozilla.org/en-US/docs/Web/HTML/Reference/...

Plus, when curious about formal syntactic correctness, there is the validator.w3.org [1].

[1] https://validator.w3.org/nu/?showsource=yes&showoutline=yes&...

I do it to render nested JSON objects, for example.