Suppose a ParallelTable invocation parallelizes a module which in turn invokes ParallelTable. Is it possible that there will be a deadlock situation wherein the second ParallelTable invocation can't proceed because the first one has been allocated all the available CPUs?
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No. The second one simply won't have any effect.
Just try, and see the warning messages.
You can read about how parallelization works here:
It is not CPUs that get allocated, but kernel processes (of which you may launch as many as you want). If a parallel command (such as ParallelTable) is run on the main kernel, it distributes its computation to subkernels. If it is run on a subkernel, it reverts to the non-parallel equivalent (i.e. Table), and prints the above warning message.
