For larger websites, navigation menus can often become so large that it is difficult to work with them in the Appearance > Menus editor.
In the menu editor, you have several different choices for items that you can insert into the menu. For example, you can insert "custom links", "pages", "categories", etc (pages being the most common). I propose that there be a new option to allow you to insert a reference to another menu. For example, if I create 2 menus: Menu A and Menu B, it would be nice if you could insert a reference to Menu B from anywhere inside Menu A.
As wp_nav_menu() loops through each item in the menu to compile an unordered list to return, it should check if the item is a menu reference, and if so it should make a recursive call to itself to return the referenced menu in that location.
If you have any questions or need further explanation, feel free to ask. Thanks!
rsteer 
Marcel Oerlemans 
