A strategy for nested mini-sites using taxonomy, fields api and domains

I am working on a Drupal 7 project and need some help solving a somewhat tricky issue. Here goes...

The website is a local business listing service organized around industries. Each industry is a mini site, and has its own subdomain. This is where the domain module comes in.

Example 1A:
mylocalsite.com - main website
automotive.mylocalsite.com - Auto-related businesses
restaurants.mylocalsite.com - Restaurants, cafes, etc.

Within industry mini sites, we want to have second-level mini sites. For automotive, we would have "Auto dealers", "Auto body shops" etc.

Example 1B:
automotive.mylocalsite.com/auto-dealers
automotive.mylocalsite.com/auto-body-shops

So that a business listing node like "Bob's auto dealership" would have a url like this:
automotive.mylocalsite.com/auto-dealers/bobs-auto-dealership

Each mini site (first or second level) has a corresponding "Landing page" node that contains custom text and graphics pertaining to that mini site. The landing page is rendered using panels.

So far here is my thought on the architecture of the site:

1. Taxonomy vocab. called "mini site".... with nested terms representing the hierarchy
2. Each term in the vocab. has a custom node reference field (D7 fields api + references module) pointing to the appropriate landing page node
3. Articles, business listings, reviews, etc (all nodes) point to one or more mini-site taxonomy terms
4. From the mini site's "landing page" we have lists of articles and business listings, etc generated by views. Views receives the taxonomy term ID as an argument, so as to show only the relevant content.

Questions that arise include:

1. How to set up a url structure as seen in example 1B above
2. If an article points to a second-level term (i.e. Auto Dealers), is it assumed to belong to Automotive as well, or do I have to explicitly map it to the parent?
3. Is there some way to hide affiliate domain mapping and auto delegate nodes to the appropriate domains based on what "mini site" taxonomy terms they are mapped to?

I want to present businesses with ONE mini site selector when they are creating listings, and not confuse them with an "affiliate domain mapping" option.

Thoughts?

Thanks!
Noah Lively