schworak,
I don't use that tool, but I know how to do thid with Wise or Orca.
I'll post some info and hope it gives you an idea. This is how I do it with Orca......
I have two MSI's A & B. I want B to be nested within A:
In MSI A:
1) Add a custom action. I want my nested MSI stored within my parent so I use type 7. Source is the name you intend to call it when it's stored in the substorage (Blah) and Target is any properties you want to pass (ADDLOCAL=ALL and ALLUSERS=[ALLUSERS] are good!

2) Add a row in the InstallExecuteSequence table. Action matches the name of the custom action, Condition (NOT Installed), and sequence of about 6650 (Wise recemmends after InstallFinalize in their Package Studio Helpfile)
3) Tricky bit: Using a VBS script form the MSI SDK (WiSubStg.vbs) embed the nested MSI(

into the parent, use the name that you used as source in the CA table!
One trick I found was that both Apps needed to default into the same INSTALLDIR or the child MSI wouldn't install (no errors, just no result).
I know this isn't ISD specific, but I hope it helps. Now I'm trying to work out how to uninstall the child when the parent is. I have found some doco on it, but it doesn't work for me

Cheers
Adam