Interesting, I see different behaviors in my setup:

4.4 on lvl1, 4.15 lvl2, trusty lvl1 qemu:
/proc/cpuinfo in lvl2 contains:
  bugs            : cpu_meltdown spectre_v1 spectre_v2 l1tf
(note missing mds, hence "Not Affected")

4.4 on lvl1, 4.15 lvl2, xenial lvl1 qemu:
/proc/cpuinfo in lvl2 contains:
  bugs            : cpu_meltdown spectre_v1 spectre_v2 spec_store_bypass l1tf 
mds

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https://bugs.launchpad.net/bugs/1829555

Title:
  nested virtualization w/first level trusty guests has odd MDS behavior

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