Each quoting level indents the quoted text a little, so if the message has accumulated a lot of replies back and forth... well, yes, it the deepest level will have little room...
This is not unique to my app, quoting in stock Gmail is nested, too, and there, too, it can get too deep.
You can reply in AquaMail using Menu / Reply (clean) rather than the default reply button to suppress the indentation, but of course this won't change anything when the other party replies back (adding another level)...