I tried selecting a paragraph <p>...text....</p> and then use increase indent and <blockquote> was wrapped around the selected paragraph. Each further increase indent wrapped another level of blockquote around the selected text while reduce indent remove a level of blockquote.
Code:
<p>“I so very much <i>love</i> rousting innocent freight crews. Not,” Sahved complained from within the destroyer’s great hangar bay. A shuttle was waiting to take the team to the next target, a cargo vessel that had stopped the instant they were notified of the inspection.</p>
<blockquote>
<p>“I so very much <i>love</i> rousting innocent freight crews. Not,” Sahved complained from within the destroyer’s great hangar bay. A shuttle was waiting to take the team to the next target, a cargo vessel that had stopped the instant they were notified of the inspection.</p>
</blockquote>
<blockquote>
<blockquote>
<p>“I so very much <i>love</i> rousting innocent freight crews. Not,” Sahved complained from within the destroyer’s great hangar bay. A shuttle was waiting to take the team to the next target, a cargo vessel that had stopped the instant they were notified of the inspection.</p>
</blockquote>
</blockquote>