esnap will not snap to items within a block

I am having problems using e-snap in that it will not snap to items within a block with the exception of the "perpendicular" entity selection.

I have checked my e-snap settings and everything seems to be in order.

If I perform "in place edit" of the block, e-snap works for items that were previously unselectable, but the problem persists for blocks nested at lower levels.

Your help would be much appreciated.

ian