Diagram nesting.

I want to develop a tool with a UI similar to Microsoft SQL SSIS Designer or Visual Studio DGML. (Architectural diagrams) 
Using the Diagramming Framework is close. But it needs some way to drag a container object onto the surface, connect it to other objects or containers. This container (group) could contain other objects or other sub-container objects. 

Thus I get a potential infinite nesting of things that can contain a group of things  which have a relationship between them. (a mini-diagram)

I'd also need a Drag/Drop event & Expand/Collapse event. My goal is to let the users draw a workflow of parallel & sequential tasks. As they change the diagram the database is updated. This drives a process which is my application. 

These types of hierarchical relationships are very common. 

Example: Manufacturing. 
The Diagram of a Process building an assembly, which contains Sub-Assemblies, which also need to be constructed.  

Example: Computing
Showing a group of scheduled tasks which can be run in parallel. But the whole group needs to be complete prior to the next group of tasks being started. (similar to a milestone)

Example: Database Object Diagram. 
Showing the relationships between tables, views & stored Procedures. But each box has a little Expand button that lets you see the indexes, triggers & Constraints that define the table.

Currently the Telerik Diagram control lets me group objects, But I can't see that grouping. I can't draw a link betwen that group & another nor can I expand / collapse the container object.  

FYI, 
1. Doesn't matter if it is WinForm, WPF, or HTML. 
2. The DGML spec that is implemented in MSFT Visual Studio does all the things I want. Except "installing VS" is a lot of overhead for my solution.