Yes with two layers of SplitInBatches there are issues to be expected. What the node does is that it takes the data it receives, saves it all, and then releases a few of them every time it gets called. If there are no items left it simply does not return anything anymore and the execution stops. In your case do you expect the node to do two different things depending on the input data. If the data comes from the IF-Node you want it to behave like I described above, if it however receives data the second time from the Function1 Node you expect it to take the incoming data as new init-data.
For it to work, do you have to tell the node that it should “reset”. Here a post from a few months ago which describes how that works:
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