I don't know that Microsoft has explained why you can only nest to nest level 32. I suspect they wanted to set some limit otherwise you could just have a stored procedure call itself and it would never stop. My guess is that an SP calling itself to infinity would cause other problems that would be worse than simply limiting the nest level to 32 and giving you an error if you exceed it.
Robert W. Marda
SQL Programmer
bigdough.com
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Robert W. Marda
Billing and OSS Specialist - SQL Programmer
MCL Systems