don’t know – sounds like a similar issue
My example above is WordPress 3.3.1
In an older install WordPress 3.1.2. I have it
Main Blog
http://mydomain.com/blog/sample-post/
Sub Blog
http://mydomain.com/blog/parenting/sample-post/
This would be my preferred option but as yet I cannot work out the differences – is there a difference in the versions of WP and how they deal with this?