Children not displayed on 2nd level parent?

Hi!
I find this quite odd as no reference was made anywhere about this issue, so it's probably a bug.

I'm working with a few CCK node types that I'm making children of the main one, called Places. All node types are only children except Places that is parent and child.
Each node type is displayed on the parent page through a dedicated block.

When there's only 2 levels to display (place -> other node types), everything works fine but when there's 3 levels (place -> place -> other node types), the blocks don't show up on the page.

Is this by design or is there anything wrong with my setup?

Thanks!
Ricardo