@jfiz: Nested collections on Kindle were previously (on Kindle Touch, PW1 and PW2 until fw 5.4.2 [PW2 factory firmware was 5.4.0]) created using
Collections Manager. That was before Amazon introduces "Cloud Collections" and ability to show/hide collections on Home view , then those changes on database level killed that Collection Manager functionality. Now you can have only "flat", one-level collections, jailbreak or no jailbreak (jailbreak "only" enables you to have "one click" creation of collections based on Calibre metadata & columns, so you don't have to manually create>name>populate collection book by book).
So no more nested collections on any Kindle with firmware newer than 5.4.0. For details check those 3 links listed under 3rd bullet point of "Requirements" section at Collections Manager thread.
I agree, smarted tags/ multilevel collection would be nice to have but "ultimate perk" gained by jailbreak for me is having custom font and font sizes and having margins reduced. Book-cover-as-screensaver is nice thing to have but it the least important motivation for me jailbreaking my Kindle. I could live without screensavers if I had to but could not be content without having all those changes directly related to reading experience & how the text is displayed. Kindle primarily being a reading device and all that :P
Also having KOreader on Kindle for 10x better PDF experience (when I am absolutely forced to use PDFs, for non-fiction books) is significant perk.