Xnest is trying to open fonts from a default font path that includes the
100dpi fonts, but the package does not require that 100dpi fonts be
installed.

Here's the error you get :
54 katzj@enki:~> Xnest :1
failed to set default font path
'/usr/X11R6/lib/X11/fonts/misc/,/usr/X11R6/lib/X11/fonts/Speedo/,/usr/X11R6/lib/X11/fonts/Type1/,/usr/X11R6/lib/X11/fonts/75dpi/,/usr/X11R6/lib/X11/fonts/100dpi/'
Fatal server error:
could not open default font 'fixed'

After installing 100dpi fonts, it works fine.