Using master to debug, the (first) offending part of the generated file is the get_match_iter() function.  The problem is not that there is too much nesting, rather it is simply the fact of too many if's period.

Simple testing at the command prompt (using master debug build) reveals the limit for just ifs is around 25000 (on Windows x64).  The actual limit is going to depend on the stack usage (debug/release/version of the C runtime).

To verify:

  exec('if a: b = 1\n' * 25150)

causes exceptions on my box.  The precise limit will vary somewhat.