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cannot start a transaction within a transaction using sqlite shell
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I agree that your test should have either succeeded, without the complaint you posted, or should have done something else. (I would think it would have "failed" often with a flurry of "busy" messages. This I expect because, by default, there is no busy handler set by the shell.)

With sqlite3 v3.36.0 on Ubuntu, instead of the error you report I get <code>
  Error: near line \#\#\#: disk I/O error
</code>, repeatedly, where the line number progresses.

I think this also should not happen. This will be investigated.