The attached test case fails with an internal error with this simple DRC script:

deep
l1 = polygons(1,0)
l2 = polygons(2,0)
out = l1.interacting(l2)

The root cause is instance duplication across hierarchy - e.g. C2 instances from C4 exactly overlap identical instances of C2 in the top cell. This case is currently treated illegal and does not make much sense, but apparently in this situation (fill pattern) it cannot be avoided entirely.

smallest_test.gds.zip