I've tried it a couple of times so it's reproducible.
Currently I've got 5 layers with about 130 clips on each layer. This is because previously, switching between decks was a bit slow and I wanted access to all my loops/clips.
Now with V4, I was trying to move groups of clips to separate decks.
So I crtl+click a number of clips (say, 5x5), select 'cut clip', switch deck to #2 (and wait for that to happen), 'paste clips'.
Then switch back to deck #1(and wait) and somehow I've now got 9 layers.
I'll try it again later and see if the logfile says anything.
I might also try it in A3 just to check it's not already a feature...

A while ago I had a look at the format of the xml document that is the composition file. It loaded into the standard microsoft xml editor, but past that it didn't make a whole lot of sense

As a bit of a lateral thought, would it be possible (or in any way likely) for someone to make an offline composition editor?
'All' it would really have to do would be to allow moving of the xml nodes around in the file, possibly with the video thumbnails to make it easier to see which clip is which.
/Sean