We were looking at the best way to setup multiple sub folder levels and we were trialling using a single subfolder record type, that allows it to be contained within itself.

But from what I can see there is on complete way to limit the number of times this can be done, allowing the folders to go down endlessly, until the record numbering hits a limit. I also tried preventing with Metadata validation rules which did work, but didn't prevent users from working around it by creating in at another level and then moving the folder.

So being able to set it so if 1 sub folder was in another sub folder it wouldn't allow another sub folder further down would be great.